Assumptions of the cournot oligopoly model

Assignment Help Business Management
Reference no: EM131594000

Suppose two firms, each with constant marginal and average cost 41 per unit, supply a market where the equation of the inverse demand curve is p=80-Q=80-(q1+q2):

(a) State the assumptions of the Cournot oligopoly model.

(b) Find Cournot duopoly equilibrium on:

_output

_price

_profit per firm

_consumers' surplus

_net social welfare (total profit plus consumers' surplus) for this market.

(c) Find the same equilibrium values if the two firms merge and as a result of the merger average cost falls to 34 per unit.

(d) Comment on the effect of the merger on consumers and on society as a whole. Show the derivations of your answers.

Reference no: EM131594000

Questions Cloud

Water resources continue to be misused : List and describe 2 potential solutions to the potential "water crisis" we may face if water resources continue to be misused.
Define the social category of street children : Define the social category of street children through three characteristics. Is the phenomenon of street children synonymous with deviant behavior-why
How and where price will be displayed on your gui interface : Assignment: Introduction to Programming Using Java- You may choose how and where the price will be displayed on your GUI interface.
Beat the odds and continue to collude : Why do you think OPEC has been able to beat the odds and continue to collude? Hint: You may wish to consider non-economic reasons.
Assumptions of the cournot oligopoly model : Suppose two firms, each with constant marginal and average cost 41 per unit, supply a market where the equation of the inverse demand curve is p=80-Q=80-(q1+q2)
Calculate the payback period and irr for shareholders : calculate the payback period and IRR for shareholders on this investment.
Define the disposal of hazardous waste : What is the most significant roadblock to ending this form of organized crime
Give reasons why s either is or is not a subspace : In Exercises, determine if the set of vectors S forms a subspace of the given vector space.
How is perfect competition defined : How is "Perfect" Competition defined? Is it really "Perfect"? Can you think of any examples that more or less operate this way?

Reviews

Write a Review

Business Management Questions & Answers

  What pricing strategies should be employed

Examine what demographics and coinciding pricing structure should JCPenney be focused on in order to increase sales after a decline from a recent change in strategies

  Organization employs csr in operations

Select some aspect of CSR, and discuss how your organization employs CSR in its operations.

  How will the internet apply to your future career

How do you utilize the Internet? How does the Internet impact your daily life? How is the Internet used professionally? How will the Internet apply to your future career?

  Find the probability of having all the red ones

She has seen a bag containing three red marbles, two green ones, three white ones, and two purple ones. She grabs eight of them. Find the probability of her having all the red ones.

  Understanding research methodsshow your understanding of

understanding research methodsshow your understanding of the nature of the three major research methods by describing

  Many drugs used to treat cancer are expensive

Many drugs used to treat cancer are expensive. BusinessWeek reported on the cost per treatment of Herceptin,

  Government regulations and employee benefits

explain government involvement in benefits can have both positive, and negative impacts; for employers taxed with providing benefits and employees as the recipients.

  Discuss key elements of positive and proactive communication

Discuss the key elements of positive and proactive communications that are missing in the following workplace scenarios and any other aspects of the situation you feel need to be corrected (and why).

  How competition and the financial system might influence

Discuss how competition, global trade and the financial system might influence the need for greater ethics, social responsibility, leadership and teamwork, innovation and change in private enterprise.

  Explain only managed to do so under heavy doses

Explain only managed to do so under heavy doses of tranquilizers prescribed by her doctor, Morton Mallard.

  Ethical terms and concepts

Be sure to properly include the ethical terms and concepts discussed during the course to your Term Paper topic. How do i go about doing this essay.

  Examine the companys strategic philanthropy

Examine the company's strategic philanthropy and how it impacts profits, brand, image and turnover, as well as society as a whole.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd