Suppose firm 1 and firm 2 each produce identical proucts and face a market demand ciure described by Q = 5,000 – 200p. Both firms have a unit cost of production c equal to 20. There are no fixed costs.What is the Bertrand-Nash Equilibrium outcome? What is the price, PB? What are the equilibrium quantities (q1,q2 & QB)? What are the total profits and profit per firm (?1,?2 & ?)?
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