Suppose That Grinch and Grubb Go into the Wine Business

question 8

Multiple Choice

suppose that Grinch and Grubb go into the wine business in a small country where wine is difficult to grow.The demand for wine is given by p = $420 - .2Q, where p is the price and Q is the total quantity sold.The industry consists of just the two Cournot duopolists, Grinch and Grubb.Imports are prohibited.Grinch has constant marginal costs of $60 and Grubb has marginal costs of $30.How much Grinch's output in equilibrium?

• A)275
• B)550
• C)825
• D)1,100
• E)1,650

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Definitions:

Addictive

Having the quality of causing users to develop a dependency, often compelling them to repeatedly seek out and use the substance or activity.

Selective Serotonin Reuptake Inhibitors

A class of drugs often prescribed as antidepressants, which work by increasing the amount of serotonin in the brain.

Norepinephrine

A neurotransmitter and hormone that plays a key role in alertness and the fight-or-flight response, also involved in mood regulation.

Serotonin

A neurotransmitter found in the brain that affects mood, appetite, sleep, memory, and learning, often associated with feelings of well-being and happiness.