Assume that demand for a good is given byp=abQ, and that there are3 firms competing in quantity (Cournot Competition) with a constant marginal costc < a.

In the three-firm case, what will be the equilibrium price and the total quantity produced in the market? computepandQ ifa=4,b=0.01, andc=2.

How does this equilibrium compared to a hypothetical perfectly competitive case? what will happen in this market when the number of firms goes to infinite?