c) Consider a market in which the market demand curve is given by P= 18 - X - Y, where X is Firm I's output, and Y is Firm 2's output. Firm 1 has a marginal cost of 3 (MC-3), while Firm 2 has a marginal cost of 6 (MC=6). i. Find the Cournot equilibrium outputs in this market. ii. Also, find the Stackelberg equilibrium in which Firm 1 acts as the leader.

c) Consider a market in which the market demand curve is given by P= 18 - X - Y, where X is Firm I's output, and Y is Firm 2's output. Firm 1 has a marginal cost of 3 (MC-3), while Firm 2 has a marginal cost of 6 (MC=6). i. Find the Cournot equilibrium outputs in this market. ii. Also, find the Stackelberg equilibrium in which Firm 1 acts as the leader.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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