Maksimisasi Laba Perusahaan dan Ekuilibrium Oligopoli Saat Perubahan Produksi Lawan Takkonstan

Abstract

Each firm in oligopoly market is competing to maximize its profit. One of the alternative strategy that can be used by the firm is to assume that changes in rival firm’s production level are nonconstant. Since the firm uses this assumption, so determination of the firm’s production level must consider the rival firm’s production level. This paper studies first-order and second-order conditions to maximize profit when changes in rival firm’s production level are nonconstant. Furthermore, it studies the effect of the change of production level at equilibrium. Competition in determining the production level to maximize profit is described by a function called reaction function. This reaction function is implied from the first-order condition. Competition in determining the level of production between firms in oligopoly market will end when the system reaches Nash equilibrium. The Nash equilibrium point is the intersection between firm’s reaction functions. At equilibrium, the change of production level affects firm’s profit quadratically. On the other hand, the change of rival firm’s production level decreases firm’s profit linearly.