The Inverse Demand for Shampoo Is Given by P =

question 144

Multiple Choice

The inverse demand for shampoo is given by P = 30 - 0.03Q, where P is the price per bottle in dollars and Q is bottles brought to market in hundreds. There are two manufacturers in the local market. Firm 1's cost function is given by C₁ = 0.05q₁², where q₁ is the number of bottles it brings to market. Firm 2's cost function is given by C₂ = 0.03q₂², where q₂ is the number of bottles it brings to market. The two firms are Cournot competitors who set output so that Q = q₁ + q₂. In equilibrium, the market quantity is ____.

• A) 147.53
• B) 213.12
• C) 295.06
• D) 360.65

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Definitions:

Range of Sale Price

The difference between the highest and lowest selling price of a product in a marketplace over a defined period.

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Transactions involving the buying of gasoline, typically for vehicles, reflecting consumer demand and market prices.

Absentee Landlord

A property owner who rents out their property but does not live on or near it, often resulting in less hands-on management.

Competitive Strategy

Involves the tactics and actions a company uses to attract customers, withstand competitive pressures, and strengthen its market position.