Health Economics

Cournot EquilibriumAssumptionsThere is more than one hearty which produce homogenous productThere is no collusion between unbendablesThe starchys output decision affects the price of the goodThe topic of familys is generally fixedFirms compete via quantitiesThe firms are rational actors in the economyGivenP 2000 - 2Q1 - 2Q2MC cdFor firm 1Q1 (2000 - 2Q1 - 2Q2 ) - cdQ12000Q1 - 2Q12 - 2Q1Q2 - 400Q1Taking the derivative of the result function for firm 1 with detect to Q1 , equating it with zero2000 - 4Q1 - 2Q1 - 400 04Q1 2000 -2Q2 - 400Q1 400 - (Q2 /2For firm 2 , the solution function isQ2 400 - (Q1 /2 Q2 400 - (400 - .5Q2 /2Q1 Q2 266 .662000 - 1066 .64 933 .

36Profit for Firm 1 and firm 2 isQ2800400 400 800 Q1Stackelberg EquilibriumGivenP 2000 - 2Q1 - 2Q2MC 400Q2 400 - Q1 /2Firm 1 is the attracter firm 2 is the follower ?1 Q1[2000 - 2Q1 - 2 (400 - .5Q1 )] - 400Q1 ?1 Q1[2000 - 2Q1 - 800 Q1] - 400Q1 ?1 Q1 (2000 - Q1 - 800 ) - 400Q1 ?1 Q1 (1200 - Q1 ) - 400Q1Taking the derivative of the profit function (of firm 1 ) with respect to Q1 , we obtaind ?1 / Q1 1200 - 2Q1 - 400 02Q1 800Q1 400 Q2 400 - .5 (400P 800 Q2 200Q1 Q2Firm 1 profit ?1 320 000 - 160 000 160 000Firm 2 profit ?2 160 000 - 80 000...If you want to mother in a full essay, order it on our website: BestEssayCheap.com

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