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Suppose the following:
(i) two countries each with demand for a homogeneous good given by P(Q) =40− Q.
(ii) in Country A there is one ?rm with a marginal cost of production of cA.
(iii) in Country B there are two ?rms, each with a marginal cost of production of cB.
(iv) competition in relevant markets is Cournot.
(a) Find for each country expressions for the equilibrium price and ?rm pro?ts and quantity under the assumption that no trade between the two countries occurs.
We can see that aid to Africa has increased significantly over the last 40 years and that incomes in Africa have stagnated. Explain why these two facts do not constitute proof that aid is not effective in increasing incomes in Africa.
In deciding where to operate along its production possibilities frontier, a society is answering the question of
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