Answer to Question #127994 in Microeconomics for Divya

Question

Case Study
Assume that two identical firms in a purely oligopolistic industry selling a homogenous product agree to share the maket equally. The total market demand function for the commodity is Qd = 240 – 10P. The cost schedules of the firms are given in the following table:

q1 40 50 60 80 q2 50 70 100
SMC1 (Rs.) 8 10 12 16 SMC1 (Rs.) 4 6 9
SAC1 (Rs.) 13 12.3 12 13 SAC1 (Rs.) 7 6 7

Question 1: When q1 = 80, what will be MR1?
a. 7
b. -4
c. 5
d. -8
Question 2: When q2 = 100, then MR2 will be
a. 16
b. 32
c. -32
d. -16
Question 3: When q2 = 50, price at this level of output will be
a. 12
b. 14
c. 24
d. 32
Question 4: When q2 = 50, then MR2 will be
a. 2
b. 4
c. 5
d. 6
Question 5: When q2 = 70, then MR2 will be
a. 4
b. -9
c. -4
d. -5

Answer 1

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