QUESTION 2 Glyde Air Fresheners is the dominant firm in the solid room aromatizer industry, which has a total market demand given by Q = 80 - 2 P. Glyde has competition from a fringe of four small firms that produce where their individual marginal costs equal the market price. The fringe firms each have total costs given by TC; = 10 Q₁ + 2 Q2₁. If Glyde's total costs are given by TCG = 100 + 6 QG, what are the total profits of the fringe firms? O $32. O $64. $96. $128. $160.

QUESTION 2 Glyde Air Fresheners is the dominant firm in the solid room aromatizer industry, which has a total market demand given by Q = 80 - 2 P. Glyde has competition from a fringe of four small firms that produce where their individual marginal costs equal the market price. The fringe firms each have total costs given by TC; = 10 Q₁ + 2 Q2₁. If Glyde's total costs are given by TCG = 100 + 6 QG, what are the total profits of the fringe firms? O $32. O $64. $96. $128. $160.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter19: Externalities And Public Goods

Section: Chapter Questions

Problem 19.1P: A firm in a perfectly competitive industry has patented a newprocess for making widgets. The new...

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Glyde Air Fresheners is the dominant firm in the solid room aromatizer industry, which has a total market demand given by Q = 80 - 2P. Glyde has competition from a fringe of four small firms that produce where their individual marginal cost equals the market price. The fringe firms each have a total cost given by: TCi = 10Qi + 2Qi2. If Glyde’s total costs are given by TCG = 100 + 6QG a) what price should Glyde establish for air fresheners? b) what is Glyde’s maximum profit?
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