Each firm's marginal cost function is MC= 20 and the market demand function is p = 56 - 2Q Where Q is the sum of each firm's output q₁and q_2.

Find the best response functions for both firms:

Revenue for firm 1

R₁= P*q₁= (56 - 2(q₁+ q₂))*q₁= 56₁- 2q₁²- 2q₁q₂.

Firm 1 has the following marginal revenue and marginal cost functions:

MR₁= 56 - 4q₁- 2q₂

MC₁= 20

Profit maximization implies:

MR₁= MC₁

56 - 4q₁- 2q₂= 20

which gives the best response function:

q₁= 9 - 0.5q₂.

By symmetry, Firm 2's best response function is:

q₂= 9 - 0.5q₁.

Cournot equilibrium is determined at the intersection of these two best response functions:

q₂= 9 - 0.5(9 - 0.5q₂)

q₂= 9 - 4.5+ 0.25q₂

0.75q₂= 4.5

q₁= q₂= 6

Thus,

Q = q₁+ q₂= 6 + 6 = 12

P = 56 - 2*12 = 32

Profit by each firm = (32 - 20)*6 = 72 and total profit is 144

Find each firm's reaction function.

q₁= 9 - 0.5q₂and q₂= 9 - 0.5q₁

Determine the profit-maximizing output for each seller.

q₁= q₂= 6

Determine the equilibrium price.

$32 per unit

Calculate each firm's profit.

$72

How much total profit is earned in the market

$144

In answerin this questions, would the total market output be $12??