Duopolists A and B face the following demand curves: Q_A = 150 - 5P_A + 4P_B and Q_B = 150 - 5P_B + 4P_A.If both firms have zero marginal cost and they form a cartel,what is the profit-maximizing price and quantity? A) P = 25, Q = 250. B) P = 40, Q = 100. C) P = 60, Q = 120. D) P = 80, Q = 80. E) P = 75, Q = 150.

Question

Quizplus · Accepted Answer

The Answer of Duopolists A and B face the following demand curves: Q_A = 150 - 5P_A + 4P_B and Q_B = 150 - 5P_B + 4P_A.If both firms have zero marginal cost and they form a cartel,what is the profit-maximizing price and quantity? A) P = 25, Q = 250. B) P = 40, Q = 100. C) P = 60, Q = 120. D) P = 80, Q = 80. E) P = 75, Q = 150.

Duopolists a and B Face the Following Demand Curves: QA

Duopolists a and B Face the Following Demand Curves: Q_A