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Suppose in a Cournot Duopoly That Two Firms, Firm 1 P=50P = 50 -

Question 2

Multiple Choice

Suppose in a Cournot duopoly that two firms, Firm 1 and Firm 2, face market demand P=50P = 50 - QQ and both have marginal cost, MC=$20M C = \$ 20 . The equilibrium output for each firm will be:


A) Q1=Q2=7.5Q _ { 1 } = Q _ { 2 } = 7.5
B) Q1=Q2=10Q _ { 1 } = Q _ { 2 } = 10
C) Q1=Q2=15Q _ { 1 } = Q _ { 2 } = 15
D) Q1=Q2=20Q _ { 1 } = Q _ { 2 } = 20

Correct Answer:

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