Suppose in a Cournot Duopoly That Two Firms, Firm 1 $P = 50 - Q$

question 4

Multiple Choice

Suppose in a Cournot duopoly that two firms, Firm 1 and Firm 2, face market demand $P = 50 - Q$ and both have marginal cost, $M C = \$ 20$ . The equilibrium industry profits in this market will be

• A) 150
• B) 200
• C) 250
• D) 300

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Definitions:

5-for-3 Split

A type of stock split where shareholders receive 5 shares for every 3 shares they hold, effectively increasing the share quantity and adjusting the stock price downward.

Shares

Units of ownership interest in a corporation or financial asset that provide for an equal distribution in any profits, if any are declared, in the form of dividends.

Franchise

A type of license that grants a franchisee access to a franchisor's proprietary knowledge, processes, and trademarks, to allow the party to sell a product or provide a service under the business's name.

Reverse Stock Split

When the number of outstanding shares is reduced and the market price per share is increased; as the price per share increases, the investor perceives that the stock is worth more.