10) In the Bertrand model with homogeneous products, A) the firm that sets the lower price will capture all of the market. B) the Nash equilibrium is the competitive outcome. C) both firms set price equal to marginal cost. D) all of the above E) the outcome is inconclusive. 11) A firm operating in a monopolistically competitive market faces demand and marginal revenue curves as given below: P = 10 - 0.1Q MR= 10 - 0.2Q The firm's total and marginal cost curves are: TC = 10Q + 0.0333Q3 + 130 MC = 10 + 0.0999(22, where P is in dollars per unit, output rate Q is in units per time period, and total cost C is in dollars. a. Determine the price and output rate that will allow the firm to maximize profit or minimize losses. b. Compute a Lerner index. 12) Consider two identical rms (no. 1 and no. 2) that face a linear market demand curve. Each firm has a marginal cost of zero and the two firms together face demand: P = 50 - 0.5Q, where Q = Q1 + Q2. a. Find the Cournot equilibrium Q and P for each firm. b. Find the equilibrium Q and P for each firm assuming that the firms collude and share the profit equally. c. Contrast the efficiencies of the markets in (a) and (b) above