Question #70759

Consider a market with two dominant firms (curnot duopoly) producing a homogenous product.

The inverse market demand function is given by

The inverse market demand function is given by

Expert's answer

According to the Cournot duopoly, the inverse market demand function is given by

P=a-b*(Q1+Q2),

Q1 – quantity of production of the first firm, Q2 – quantity of production of the second firm.

P=a-b*(Q1+Q2),

Q1 – quantity of production of the first firm, Q2 – quantity of production of the second firm.

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