Suppose That Two Cournot Duopolists Serve the Peoria-Dubuque Route, and the Demand

question 2

Multiple Choice

suppose that two Cournot duopolists serve the Peoria-Dubuque route, and the demand curve for tickets per day is Q = 240 - 2p (so p = 120 - Q/2) .Total costs of running a flight on this route are 900 + 30q, where q is the number of passengers on the flight.Each flight has a capacity of 80 passengers.In Cournot equilibrium, each duopolist will run one flight per day and will make a daily profit of

• A)$240.
• B)$900.
• C)$1,800.
• D)$450.
• E)$3,600.

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