The above figure shows the reaction functions for two pizza shops in a small isolated town. A. I… 1 answer below »

200 Bs best response 100 As best response 66.7 50 50 100 200 66.7 1) The above figure shows the reaction functions for two pizza shops in a <a href=small isolated town. A. Identify the Cournot equilibrium point. B. What is the level of output that will be produced in collusion? C. What output will correspond to a perfect competitive outcome? D. Explain if Firm B producing 100 pizzas and firm A producing 50 pizzas will correspond to a Cournot equilibrium. “>

The above figure shows the reaction functions for two pizza shops in a small isolated town. A. Identify the Cournot equilibrium point. B. What is the level of output that will be produced in collusion? C. What output will correspond to a perfect competitive outcome? D. Explain if Firm B producing 100 pizzas and firm A producing 50 pizzas will correspond to a Cournot equilibrium.

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