The graph below shows a duopolistic market. The firms in this market produce and sell identical products. The graph below shows the market demand, a corresponding marginal revenue curve for the product, and an identical marginal cost curve for each firm. Assume both firms have the goal of maximising economic profit. If the two firms were to collude, what would be the total economic profit made by each firm? Price($) 10 LO 00 HNWAUG MC MR D O 0 1 2 3 4 5 6 7 8 9 10 Quantity O $24 O $8 O so O $6 Insufficient information to determine economic profit of each firmQUESTION 6 The graph below shows a duopolitic market. The firm In this market produce and sell identical products. The graph below shows the market demand, a corresponding marginal revenue curve for the product, and an Identical marginal cost curve for each jim Assume both firms have the goal of maximising economic profit. If either firm charges a lower price than the other, then the firm charging the lowest price will supply the entire market at that price. Assuming the two firms do not communicate with each other In any way and act in their own Immediate self-Interest, what is likely to be the Nash equilibrium output In the market in the short-term? Price($) 10 Nwbug MC MR D 7 8 9 10 1 2 3 4 S Quantity D 4 OQUESTION 7 The following graph shows demand and cost curves of the only cinema In a small county town. The dnema is a monopoly. The marginal cost of each movie ticket sold is $0. The marginal cost curve is shown on the diagram below. The cinema owner has identified two distinct groups of customers: 'adults' (16-64yr olds) and "seniors (over 65yrs old). The demand curves of these two groups are shown on the diagram below. Assuming the cinema owner is a profit maximiser, what is the difference in the prices she will charge to these two groups? Price($) 10 9 D seniors D adults OKNWA MC 1 2 3 4 5 6 7 8 9 10 Quantity O sI O SA O $0.50QUESTION B The following graph Illustrates a labour market. If the market wage rate is currently $5 per hour, what is the equilibrium wage rate likely to be? Wage rate($) 10 9 N SL OL 1 2 3 4 7 9 10 Quantity of labour It Is not possible to say because there are two equilibria