In a Cournot oligopoly, if a firm's marginal cost is not constant, its best- response curve will not be linear.

Question

Quizplus · Accepted Answer

The best-response curve in a Cournot oligopoly represents the output level that maximizes a firm's profit given the output levels of other firms in the market. When a firm's marginal cost is not constant, the firm's profit-maximizing output level will change based on the output levels of other firms. Therefore, the best-response curve will not be linear, as it will not have a constant slope.

In a Cournot Oligopoly, If a Firm's Marginal Cost Is