Saturday, November 12, 2011

Pls help me find Stackelberg equilibrium price and industry output!?

Here's the question: Suppose demand function is given as P=300-5Q. There are only two firms(1&2) in the market producing the commodity such that Q1 + Q2 = q. The marginal costs of the firms are given as MC1=MC2=60. uming that firm 1 is the leader, find the Stackelberg equilibrium and industry output. Pleeeeeeeeease help with this! Thanks a ton!

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