-The above figure shows the reaction functions for two pizza shops in a small isolated town.The perfect competitive outcome is that

Question

Quizplus · Accepted Answer

The perfect competitive outcome is where the market demand curve intersects the market supply curve. In this case, the market demand curve is the horizontal line at a price of $10, and the market supply curve is the upward-sloping line. The intersection of these two curves occurs at a quantity of 200 pizzas, which means that the perfect competitive outcome is that the firms split the production of 200 pizzas.

-The Above Figure Shows the Reaction Functions for Two Pizza