Let Firm a Face Demand Curve $Q _ { A } = 100 - P _ { A } + .5 P _ { B }$

question 47

Multiple Choice

Let firm A face demand curve $Q _ { A } = 100 - P _ { A } + .5 P _ { B }$ and firm B face demand curve $Q _ { B } = 100 -$ $P _ { B } + .5 P _ { A }$ . Products $\mathrm { A }$ and $\mathrm { B }$ both have constant marginal cost of production of 10 per unit (and no fixed cost) . Each firm acts as a Bertrand competitor. What are the Bertrand Equilibrium prices in this market?

• A) \(P _ { B } = 72.5 ; P _ { A } = 70\)
• B) \(P _ { B } = P _ { A } = 73.33\)
• C) \(P _ { B } = 74 ; P _ { A } = 87\)
• D) \(P _ { B } = P _ { A } = 74\)

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Definitions:

Cost Information

Data related to the expenses incurred in the production, operation, or acquisition of goods and services, used for financial analysis and decision-making.

Direct Materials

Materials that can be directly traced to the production of specific goods or services.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company.

Manufacturing

The process of converting raw materials into finished products through various methods such as assembly, machining, or chemical processing.