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Business, 16.12.2019 19:31 scbmaster351

An industry has two firms producing at a constant unit cost of $10 per unit. the inverse demand curve for the industry is p = 110 - .5q. suppose that firm 1 is a stackelberg leader in choosing its quantity (i. e., firm 1 chooses its quantity first, knowing that firm 2 will observe firm 1’s quantity when it chooses its own output.) in equilibrium, how much output will firm 2, the follower, produce?

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