What is the profit maximizing output

Reference no: EM131072272

Consider the market demand curve for appliances: P = 3,200-(1/4)Q. There are no fixed production costs, and the marginal cost of each appliance is MC = $400.

(a) Determine the output that will be produced in a ‘perfectly competitive' market structure where no profits accrue in equilibrium.

(b) If this market is supplied by a monopolist what is the profit maximizing output?

(c) What will be the total output produced in the Cournot duopoly game? [Hint: you can either derive the reaction functions and solve them, or use the formula from Section 10.6 of the chapter.]

Reference no: EM131072272

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