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Two firms compete in a market to sell a homogeneous product with inverse demand function P= 600 - 3Q. Each firm produces at a constant
Two firms compete in a market to sell a homogeneous product with inverse demand function P= 600 - 3Q. Each firm produces at a constant marginal cost of $300 and has no fixed costs. Use this information to compare the output levels and profits in settings characterized by Cournot, Stackelberg, Bertrand, and collusive behavior. Instruction: Do not round intermediate calculations. Round final answers to two decimal places for Cournot values. Cournot output for each firm: 50 x Cournot profits for each firm: $ 15,000 Stackelberg leader output: 100 x Stackelberg follower output: 75 x Stackelberg leader profits: $ 13,125 x Stackelberg follower profits: $ 13,125 X Bertrand market-level output: 200 x Bertrand profits for each firm: $ 0 Collusive market-level output: 50 Collusive industry-level profits: $ 30,000
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