Suppose Two Duopolists Operate at Zero Marginal Cost

question 2

Multiple Choice

Suppose two duopolists operate at zero marginal cost.The market demand is p = a - bQ.If firm 1 is the Stackelberg leader,what level of output will it choose?

• A) q₁ = (a - bq₂)/2b
• B) q₁ = (a - 2bq₂)/2b
• C) q₁ = a/b
• D) q₁ = a/2b

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Definitions:

Patricia Papernow

An expert in the field of blended families and stepfamily dynamics, known for her research and publications on the topic.

Co-Parent Family

A family structure where parents work together to raise their child or children, often despite being separated, divorced, or not living together.

Co-Mother Family

A family structure in which two women raise children together, each assuming maternal roles and responsibilities.

Stepparent Roles

The duties and responsibilities adopted by individuals who marry or partner with someone who already has children from a previous relationship.