2237 12/02/20 10% 06 Question (5 points) See page 531 Consider a market served by two firms: firm A and firm B. Demand for the good is given (in inverse form) by P(Q) = 450 - 1.00Q, where O is total quantity in the market (and is the sum of firm A's output, qA, and firm B's output, qB) and P is the price of the good. Each firm has a cost function of c(q) = 210.00q, which implies marginal cost of $210.00 for each firm, and the goods sold by firms A and B are identical. V 1st attempt Part 1 (2 points) * Feedback See Hint If the two firms compete in price (Bertrand competition) then each of them will set price of * $ 290 and earn profit of * $ 6400 . (Give your answers to two decimal places.) Part 2 (3 points) * Feedback See Hint Now suppose that the two firms compete by setting quantities (Cournot competition). In equilibrium they will each produce 23 60 units and the price of the good will be * $ 330 . Each firm will earn profit of * $ 7200 . (Give your answers to two decimal places.) 2 OF 9 QUESTIONS COMPLETED + VIEW SOLUTION C TRY AGAIN DEC 1 7,023 A