In the Cournot example ( $P = 100 - Q$ , $MC = 10$ ), the monopoly output would be $Q_m = 45$ and the competitive output $Q_c = 90$ . Cournot output is 60, what fraction of the way from monopoly to competition?

Estimate on a scale from 0% (0) to 100% (100).

Hints

$(60 - 45)/(90 - 45)$ .
Both differences are measured from the monopoly output.

Show the answer

33 (answers within ±5 count)

Why

$(60 - 45)/(90 - 45) = 15/45 = 1/3 \approx 33\%$ . Cournot is one-third of the way from monopoly to competition, adding one competitor moves the market considerably.

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In the Cournot example (P=100−QP = 100 - QP=100−Q, MC=10MC = 10MC=10), the monopoly output would be Qm=45Q_m = 45Qm​=45 and the competitive output Qc=90Q_c = 90Qc​=90. Cournot output is 60, what fraction of the way from monopoly to competition?

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In the Cournot example ( $P = 100 - Q$ , $MC = 10$ ), the monopoly output would be $Q_m = 45$ and the competitive output $Q_c = 90$ . Cournot output is 60, what fraction of the way from monopoly to competition?