North Bend Currently Has One McDonald's Fast-Food Franchise

North Bend currently has one McDonald's fast-food franchise.Demand for hamburgers in North Bend is given by Q = 300 - 10P.Any McDonald's franchise has costs of C = 70 + 2Q for producing Q hamburgers.If a second McDonald's franchise were to move into North Bend (and both behaved as duopolists) , the profit of the original McDonald's would fall from

A) $1,890 to $1,602.22.
B) $1,960 to $1,602.22.
C) $2,240 to $1,057.78.
D) $1,890 to $801.11.
E) $1,960 to $1,672.22.

Correct Answer:

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