Question
A two - firm cartel producing industrial diamonds faces the following demand function; Q = 120 - 10 P or P = 12 - 0.1
A two - firm cartel producing industrial diamonds faces the following demand function;
Q = 120 - 10P orP = 12 - 0.1Q
The marginal cost and average total cost functions of each firm are, respectively,
MC1 = 4 + 0.2Q1andATC1 = 4 + 0.1Q1
MC2 = 4 + 0.2Q2andATC2 = 4 + 0.1Q2
Calculate the profits per unit and in total for each firm.
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Essentials Of Economics
Authors: Bradley Schiller
7th Edition
0073375802, 9780073375809
