A Duopoly Faces the Inverse Demand Curve P = 160

question 36

Multiple Choice

A duopoly faces the inverse demand curve p = 160 - 2q.Both firms in the industry have constant costs of $10 per unit of output.In a Cournot equilibrium how much output will each duopolist sell?

• A)75
• B)54
• C)25
• D)35
• E)48

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Definitions:

Income

Receipts from labor or investments, typically disbursed at regular intervals.

Consumption

The process by which goods and services are utilized to satisfy human wants, including the use of resources.

Income

The monetary payment received by an individual or household for their labor, investments, or from transfer payments, used to fund consumption and savings.

Interest Rate

The cost of borrowing money or the return on investment, typically expressed as an annual percentage of the principal.