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(Cournot's Model of Duopoly) Joe and Rebecca are small-town ready-mix concrete duopolists. The market demand function is Qd = 5500 25P, where P is the price of a cubic metre of concrete and Qd is the number of cubic metres demanded every year. Marginal cost is $40 per cubic metre. Competition in this market is described by the Cournot model.

(a) What are Joe and Rebecca's Nash Equilibrium outputs?

(b) What is the resulting price?

(c) How does the price compare to the marginal cost? What do they each earn as profit?

(d) How do the price and the two firms' joint profit (the sum of their individual profits) compare to the monopoly price and profit?