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Which of the following is a profit-maximizing condition for a Cournot oligopolist?

a.MR = MC

b.Q1 = Q2 = ... = Q

c.P = MR

d.All of the statements associated with this question are corr

User Grammar
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1 Answer

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Final answer:

The profit-maximizing condition for a Cournot oligopolist is when marginal revenue equals marginal cost, which is option a. MR = MC.

Step-by-step explanation:

The profit-maximizing condition for a Cournot oligopolist, similar to that of a perfectly competitive firm or a monopoly, is when marginal revenue (MR) is equal to marginal cost (MC). Therefore, the correct answer is a. MR = MC. This rule applies to various market structures and suggests that firms will maximize profits by producing a quantity at which the additional revenue from selling one more unit equals the additional cost of producing that unit. It's important to recognize that while b. Q1 = Q2 = ... = Q could imply some level of collusive behavior like a cartel, and c. P = MR may occur under perfect competition, neither of these conditions is inherently about profit maximization for a Cournot oligopolist, which focuses on MR = MC.

User Pawan Patil
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