Suppose a Duopoly Had Reached the Monopoly Outcome and Then

question 196

Multiple Choice

Suppose a duopoly had reached the monopoly outcome and then the first firm increased its production.If the second firm next increases its production,the second firm's profit ________ and the first firm's profit ________.

• A) increases; increases
• B) increases; decreases
• C) decreases; increases
• D) decreases; decreases
• E) increases; does not change

---

Definitions:

Equity

The value of ownership interest in a company, represented by the shares held by investors.

Depreciation Expense

An accounting method that allocates the cost of a tangible asset over its useful life, representing the wear and tear, deterioration, or obsolescence of the asset.