First con id er f rst the c se of uniformpricing monopoly as a benchm ark Then in this case Q q and the profit function is Q 50 2QQ 10 2Q 48Q 2Q 10 Solving dQ 0 we get Q 12 P 26 278 CS 1250 26 144 TS 278 144 422 MONOPOLY Now let us cons ID: 80678
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2 10. Solving ddQ = 0 we get Q = 12, P = 26, = 278, CS = 12(5026)2 = 144, TS = 278 + 144 = 422. MONOPOLY 144 422 Now let us consider the case of two firms, or duopoly. Let q 1 be the output of firm 1 a 2 )] 10 2q 1 2 (q 1 ,q 2 ) = q 2 [50 2 (q 1 + q 2 )] 10 for all q 1 0 and 212112(,)(,)***qqqq for all q 2 0.