The Inverse Demand in a Cournot Duopoly Is P =

question 4

Multiple Choice

The inverse demand in a Cournot duopoly is P = a - b(Q₁ + Q₂) , and costs are C₁(Q₁) = c₁Q₁ and C₂(Q₂) = c₂Q₂. The government has imposed a per-unit tax of $t on each unit sold by each firm. The tax revenue is:

• A) t times the total output of the two firms should there be no sales tax.
• B) less than t times the total output of the two firms should there be no sales tax.
• C) greater than t times the total output of the two firms should there be no sales tax.
• D) None of the answers is correct.

---

Definitions:

Binocular Cue

Visual information taken in by two eyes that enable a sense of depth perception, or 3D vision.

Depth Perception

The ability to see objects in three dimensions and to judge the distance of objects.

Retinal Disparity

A key concept in binocular vision, referring to the slight difference in the images projected on the retina of each eye, which is crucial for depth perception.

Clyde Tombaugh

An American astronomer best known for discovering Pluto in 1930.