1. Boeing and Airbus are the two major airplane producers. Let y A denote the number of A340's produced by Airbus, and 313 denote the number of 777's produced by Boeing. Prospective buyers regard the two planes as perfect substitutes. The inverse market demand curve is estimated to be: P : 580.5Y, where Y = yA+yB Boeing and Airbus have identical cost functions for these planes: C(yz) = 10y1-z' = A, B. (a) Suppose the two rms try to collude and jointly produce the monOpoly output. Show that they would each produce 24 planes. (b) How much could Boeing gain if instead of producing 24 planes, it reneges on the agreement and maximizes prots under the expectation that Airbus will produce 24 planes? (c) Suppose the two rms try for an agreement in which each produces 32 planes. Show neither rm will have an incentive to cheat on this agreement. ((1) Characterize this solution graphically as an intersection of the rms' best reply functions