Ann and Bruce each own a pizza store in Frostbite Falls, Minnesota.Demand for pizza is given by Q = 400 2 40P.Having the only two pizza stores in Frostbite Falls, they attempt to profitably split the market without violating the Sherman Antitrust Act.Each has the cost function C = 50 + 2Q.If Ann and Bruce behave as duopolists, each earns a profit of
A)$568.89.
B)$497.78.
C)$0.
D)$234.44.
E)$640.

Question

Ann and Bruce each own a pizza store in Frostbite Falls, Minnesota.Demand for pizza is given by Q = 400 2 40P.Having the only two pizza stores in Frostbite Falls, they attempt to profitably split the market without violating the Sherman Antitrust Act.Each has the cost function C = 50 + 2Q.If Ann and Bruce behave as duopolists, each earns a profit of
A)$568.89. 
B)$497.78.
C)$0.
D)$234.44.
E)$640.

Quizplus · Accepted Answer

The Answer of Ann and Bruce each own a pizza store in Frostbite Falls, Minnesota.Demand for pizza is given by Q = 400 2 40P.Having the only two pizza stores in Frostbite Falls, they attempt to profitably split the market without violating the Sherman Antitrust Act.Each has the cost function C = 50 + 2Q.If Ann and Bruce behave as duopolists, each earns a profit of
A)$568.89. 
B)$497.78.
C)$0.
D)$234.44.
E)$640.

Ann and Bruce Each Own a Pizza Store in Frostbite