To examine the​ trade-off between market efficiency and market power from a​ merger, consider a market with two firms that sell identical products. Firm 1 has a constant marginal cost of ​$1​, and Firm 2 has a constant marginal cost of ​$2. The market demand is Qequals15minusp. The​ Cournot-Nash equilibrium occurs where q 1 equals nothing and q 2 equals nothing. ​ (Enter numeric responses using real numbers rounded to two decimal​ places.)

Respuesta :

Answer:

q1=5

q2=4

Explanation:

In a Cournot model with a demand of the form [tex]P=a-bQ[/tex] and firms with constant marginal costs we can easily find that  the equilibrium quantities are given by

[tex]q_1=\frac{a-2c_1+c_2}{3}[/tex]

[tex]q_2=\frac{a-2c_2+c_1}{3}[/tex]

where [tex]q_1[/tex] is the quantity produced by firm 1 and  [tex]c_1[/tex] are its marginal costs. The same for firm 2.

So replacing with the data given in the problem we have that

[tex]q_1=\frac{15-2\times1+2}{3}=\frac{15}{3}=5[/tex]

[tex]q_2=\frac{15-2\times2+1}{3}=\frac{12}{3}=4[/tex]