Table 16-6 -Refer to Table 16-6.This Table Shows the Demand Schedule for the Demand

question 64

Multiple Choice

Table 16-6

-Refer to Table 16-6.This table shows the demand schedule for a particular product.Suppose that the marginal cost to produce this product is constant at $2 per unit and that the fixed cost of producing this product is $10.If the market is served by two duopolists who each,acting in their own self-interest,choose the Nash equilibrium level of production,how much profit will each firm earn?

• A)$10
• B)$20
• C)$30
• D)$40

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Definitions:

Production Budget

An estimate of the number of units that must be produced during a period to meet expected sales demand and to satisfy ending inventory requirements.

Raw Materials

These are the basic, unprocessed inputs used in manufacturing to produce finished goods.

Selling and Administrative Expense Budget

A detailed plan that estimates the expenses related to selling products and managing the business.

Fixed Costs

Costs that remain constant regardless of the amount of output or sales.