A market has many small firms and one dominant firm

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A market has many small firms and one dominant firm. The market demand is Q = 100 - 5P. The dominant firm has a constant marginal cost of $6. All the smaller fringe firms combined have a supply curve given by Qs = 4P - 8.

The dominant firm sets the market price, and the fringe firms act as price takers. The dominant firm allows the fringe firms to sell as many units as they want at the price set by the dominant firm. The rest of the market is then supplied by the dominant firm.

The profit-maximizing quantity produced by the dominant firm is ___ units, and the price it charges is $___. The fringe firms will produce and sell a total of ___ units at the market price of $9.

Reference no: EM13898612

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