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Explain why Assume there are two companies each of which chooses a quantity level simultaneously. The profit of each firm is determined to be pqs-952-9.
Explain why Assume there are two companies each of which chooses a quantity level simultaneously. The profit of each firm is determined to be pqs-952-9. where qs is the quantity the company produces and 9. is the quantity the other company produces. Assume p=3. (Choose option(s) which is/are true about the setting above 3 points for each correct option, in total 6 points. Options are independent) A) It is possible to make these companies reach Pareto optimum with per-unit subvention of 0.24 B) It is possible to make these companies reach Pareto optimum with per-unit tax of 0.24 C) If the companies merge, the combined profit will be 2 OD) Each firm will have profit of 0.75
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