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Suppose That There Are Four Identical Firms in an Industry

Question 14

Multiple Choice

Suppose that there are four identical firms in an industry. The Cournot model predicts that the output of each firm will be:


A) Equal to one-fourth the output of the remaining firms in the industry.
B) Equal to one-third the output of all the remaining firms in the industry.
C) Exactly equal to the output of the each of the remaining firms in the industry.
D) Answers b and c are correct.
E) Cannot be determined from the information provided.

Correct Answer:

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