-The above figure shows the reaction functions for two pizza shops in a small isolated town. Firm B producing 100 pizzas and firm A producing 50 pizzas is NOT a Cournot equilibrium because

Question

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Firm B is not on its best-response function, meaning it is not producing the quantity that maximizes its profit given the quantity produced by Firm A. In a Cournot equilibrium, each firm chooses its quantity based on the quantity chosen by the other firm, aiming to be on its best-response function.

-The Above Figure Shows the Reaction Functions for Two Pizza