PI 3.6 Cournot Equilibrium. VisiCalc, the first computerspreadsheet program, was released to the public in 1979. A year later, introduction of the DIP format made spreadsheets much more popular because they could now be imported into word processing and other software programs. By 1983, Mitch Kapor used his previous programming experience with VisiCalc to found Lotus Corp. and introduce the wildly popular Lotus 1-2-3 spreadsheet program. Despite enormous initial success, Lotus 1-2-3 stumbled when Microsoft Corp. introduced Excel with a much more user-friendly graphical interface in 1987. Today, Excel dominatesthe market for spreadsheet applications software.

To illustrate the competitive process in markets dominated by few firms, assume that a twofirm duopoly dominates the market for spreadsheet application software, and that the firms face a linear market demand curve?