Consider a Market Consisting of Two Firms Where the Inverse

question 84

Multiple Choice

Consider a market consisting of two firms where the inverse demand curve is given by P = 500 − 2Q₁ − 2Q₂.Each firm has a marginal cost of $50.Based on this information,we can conclude that aggregate quantity in the different equilibrium oligopoly models will follow which of the following orderings?

• A) Q^Collusion < Q^Stackelberg < Q^Cournot < Q^Bertrand
• B) Q^Collusion < Q^Cournot < Q^Stackelberg < Q^Bertrand
• C) Q^Bertrand < Q^Collusion < Q^Cournot < Q^Stackelberg
• D) Q^Bertrand < Q^Stackelberg < Q^Cournot < Q^Collusion

---

Definitions:

Merger

A merger is the combination of two or more companies into a single entity, typically to combine resources and streamline operations for better efficiency and growth.

Short-form Merger

A type of merger that allows a parent company to merge with its subsidiary without the approval of the subsidiary's shareholders.

Dissolution

The process of formally ending or dissolving a company or contractual relationship.

Free-Writing Prospectus

A written, electronic, or graphic communication associated with the offer to sell a security and used during the waiting period to supplement other information about the security.