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The large turbine generator industry is a duopoly The two firms GE and Westinghouse compete through Cournot quantity setting competition The

The large turbine generator industry is a duopoly. The two firms, GE and Westinghouse, compete through Cournot quantity setting competition. The demand curve for the industry is P=100-Q, where Pis price (in $millions) and Qis the total quantity produced by GE and Westinghouse. Currently, each firm has marginal cost of $40 and no fixed costs. Show that the equilibrium price is $60, with each firm producing 20 machines and earning profits of $400.

May 15 2020 View more View Less

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