g. Suppose that, instead of a recurring fixed cost, the marginal cost for each firm was linear
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g. Suppose that, instead of a recurring fixed cost, the marginal cost for each firm was linear and upward sloping, with the marginal cost of the first unit the same as the constant marginal cost assumed in the text. Without working this out in detail, what do you think happens to the best response functions, and how will this affect the output quantities in the Cournot equilibrium?
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Related Book For
Microeconomics An Intuitive Approach With Calculus
ISBN: 9781337335652,9781337027632
2nd Edition
Authors: Thomas Nechyba
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