Managerial Economics > Quiz > MBA 6140 MBA Managerial Economics (questions with 100% verified correct answers) (All)
MBA 6140 MBA Managerial Economics (questions with 100% verified correct answers)
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MBA 6140 MBA Managerial Economics (questions with 100% verified correct answers)5.1.01 Market demand is P = 50 - Q, and two homogeneous products firms serve a market. Both firms have marginal costs o... f 10. Firm 1 has a reaction curve of the form Q1 = A + BQ2. Find A Demand is thus P = 50 – Q1 – Q2. MR for firm 1 is MR1 = 50 – Q2 – 2Q1. Setting MR1= MC gives 50 – Q2 – 2Q1 = 10, so solving for Q1 gives Q1 = 20 – 0.5Q2, so A = 20. 5.1.02 Market demand is P = 50 - Q, and two homogeneous products firms serve a market. Both firms have marginal costs of 10. Firm 1 has a reaction curve of the form Q1 = A + BQ2. Find B Demand is thus P = 50 – Q1 – Q2. MR for firm 1 is MR1 = 50 – Q2 – 2Q1. Setting MR1= MC gives 50 – Q2 – 2Q1 = 10, so solving for Q1 gives Q1 = 20 – 0.5Q2, so B = -0.5. 5.1.03 Market demand is P = 50 - Q, and two homogeneous products firms serve a market. Both firms have marginal costs of 10. The firms choose their output simultaneously. Find the Nash/Cournot equilibrium output for firm 1. Solving Q1 = 20 – 0.5Q2 with Q2 = 20 – 0.5Q1 gives Q1 = 20 – 0.5[20 – 0.5Q1] Q1 = 10 +0.25Q1 Q1 (.75) = 10 Q1 = 10/.75 = 13.33333333 [Show More]
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