Suppose That the Inverse Demand for Bean Sprouts Is Given

question 33

Multiple Choice

Suppose that the inverse demand for bean sprouts is given by P(Y) = - 4Y and the total cost of producing Y units for any firm is TC(Y) = 10Y.If the industry consists of two Cournot duopolists, then in equilibrium each firm's production is

• A)45 units.
• B)22.50 units.
• C)15 units.
• D)30 units.
• E)23.13 units.

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Definitions:

Individual Supply Curves

Graphical representations showing the relationship between the price of a good and the quantity of the good a seller is willing to supply, holding all else constant.

Market Supply Curve

A graphical representation showing the relationship between the price of a good and the total output of the industry.

Market Price

The going rate for an asset or service to be acquired or disposed of in the marketplace.

Equilibrium Price

The price at which the quantity of a good demanded by consumers balances the quantity supplied by producers, resulting in a stable market condition.