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Questions › UoH › UoH 2021 › Q74
1 mark, −0.33Microeconomics › Monopolistic competition and oligopoly › Cournot competitionModerateabout 2 min

UoH 2021 Question 74: Monopolistic competition and oligopoly

Consider a duopoly with the following market demand function: P=30−QP = 30 - QP=30−Q. Each firm is having a zero marginal cost. Then, in the Cournot equilibrium, the firm outputs and the market price are:

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Consider a duopoly with the following market demand function: P = 30 - Q. Each firm is having a zero marginal cost. Then, in the Cournot equilibrium, the firm outputs and the market price are: (A) output produced 10 by each firm and P is 10 (B) output produced 9 by each firm and P is 12 (C) output produced 11 by each firm and P is 8 (D) output produced 12 by both firm and P is 6

Monopolistic competition and oligopoly has come up 104 times in 7 exams since 2004.

What this question tests

This question is on Cournot competition, part of Monopolistic competition and oligopoly in Microeconomics.

Firms choosing quantities simultaneously, reaction curves, and equilibrium as the number of firms or costs change.

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