Purchase Solution

Oligopoly

Not what you're looking for?

Ask Custom Question

Consider an oligopoly in which the inverse function p(?xi) = a - b ?xi, a, b > 0, and each firm's costs c(xi) = cxi, 0 < c < a. First, given n, determine the Cournot-Nash equilibrium outputs, profits, deviation of price from marginal cost, and deadweight loss. Then prove that all of these approach zero asymptotically as n tends towards infinity. Comment on the significance of these results.

Purchase this Solution

Solution Summary

The solution calculates the profit and equilibrium of oligopolistic competition with infinitely many firms.

Purchase this Solution


Free BrainMass Quizzes
Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.