There Are Only Two Firms in an Industry with Demand

question 104

Multiple Choice

There are only two firms in an industry with demand curves q₁ = 30 - P and q₂ = 30 - P.Both have no fixed costs and each has a marginal cost of 10 per unit produced.If they behave as profit-maximizing price takers,each produces 20 units and sells them at a price of 10 so that each firm makes zero economic profits.If they formed a cartel,the profit-maximizing price is

• A) 10.
• B) 15.
• C) 20.
• D) 25.

---

Definitions:

Life Cycles

The series of changes in the life of an organism, including reproduction, growth, and in some cases, aging and death. It can also apply to products, organizations, and systems as they go through stages from inception to demise.

Flexible And Efficient

The ability of an entity, such as an organization or individual, to adapt to changes while maintaining high productivity and effectiveness.

Mechanistic Structure

A form of organizational structure that is rigid and tightly controlled, emphasizing a hierarchical, top-down management approach and fixed duties.

Organic Structure

An organizational design that is flexible and decentralized, with low levels of formalization, encouraging collaboration and adaptability to change.