For firms with constant and equal long-run marginal cost curves,the Cournot equilibrium occurs at:
A)the point of intersection of the firms' reaction curves.
B)the point where price equals marginal cost.
C)the point where the demand curve is tangent to the marginal cost curve.
D)the point of intersection of one firm's reaction curve and the demand curve.

Question

Quizplus · Accepted Answer

The Cournot equilibrium is defined as the point where each firm's output decision is optimal, given the output decision of the other firm. This is represented by the intersection of the firms' reaction curves.

For Firms with Constant and Equal Long-Run Marginal Cost Curves,the