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25-05-2023
Business

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•Exercise #4. Suppose an inverse demand P=56–2P=56–2Q with =1+2Q=q1+q2. Each firm incurs a total cost 2020q_i with =1,2i=1,2. Suppose firm 1 can choose its quantity before firm 2.
•Q8) Determine the Stackelberg equilibrium quantity for firm 1.
•Q9) Determine the Stackelberg equilibrium quantity for firm 2.

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