Exam 28:Oligopoly-Part B

In Problem 5,suppose that Grinch and Grubb go into the wine business in a small country where wine is difficult to grow.The demand for wine is given by p=$480 -.2Q,where p is the price and Q is the total quantity sold.The industry consists of just the two Cournot duopolists,Grinch and Grubb.Imports are prohibited.Grinch has constant marginal costs of $30 and Grubb has marginal costs of $45.How much Grinch's output in equilibrium?

There are two firms in the blastopheme industry.The demand curve for blastophemes is given by p = 1,500 - 2q.Each firm has one manufacturing plant and each firm i has a cost function C(q_i)= q²i,where q_i is the output of firm i.The two firms form a cartel and arrange to split total industry profits equally.Under this cartel arrangement,they will maximize joint profits if

If in Problem 4,the inverse demand for bean sprouts were given by P(Y)= 640 - 3Y and the total cost of producing Y units for any firm were TC(Y)=10Y and if the industry consisted of two Cournot duopolists,then in equilibrium each firm's production would be

Suppose that the duopolists Carl and Simon in Problem 1 face a demand function for pumpkins of Q = 16,800 - 800P,where Q is the total number of pumpkins that reach the market and P is the price of pumpkins.Suppose further that each farmer has a constant marginal cost of $1 for each pumpkin produced.If Carl believes that Simon is going to produce Q_s pumpkins this year,then the reaction function tells us how many pumpkins Carl should produce in order to maximize his profits.Carl's reaction function is R_C (Q_s)=

In Problem 6,suppose that two Cournot duopolists serve the Peoria-Dubuque route,and the demand curve for tickets per day is Q =190 -2p (so p = 95 - Q/2).Total costs of running a flight on this route are 1,050 + 20q,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