Question
Demand curves an oligopolist facing for price increases and price decreases are given below. Q1=280-40P1 or P1=7-0.025Q1 Q2=100-10P2 or P2=10-0.1Q2 If the total cost function
Demand curves an oligopolist facing for price increases and price decreases are given below. Q1=280-40P1 or P1=7-0.025Q1 Q2=100-10P2 or P2=10-0.1Q2 If the total cost function for the oligopolist: TC=2Q+0.025Q2; a. Find the marginal revenue curves MR1 and MR2 for each demand function and the marginal cost curve MC. b. Find the P and Q at the kink of the demand curve. c. Find the upper and lower bounds of the marginal revenue gap. d. Show that MC is located within the marginal revenue gap. e. Calculate the total profit for the oligopolist. f. Draw kinked deman curve graph
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