2

3. In the first-mover model, suppose P = 200 - Q, r = .5 and the initial price the first firm charges is $50. a) Draw both the true demand and the introductory demand curve for this industry. b) Derive the demand curve for the second-mover firm. What is the highest price at which the second mover can obtain any customers? c) What price would the second firm have to offer to convert the 50" customer?3. In the first-mover model, suppose P = 200 - Q, r = .5 and the initial price the first firm charges is $50. a) Draw both the true demand and the introductory demand curve for this industry. b) Derive the demand curve for the second-mover firm. What is the highest price at which the second mover can obtain any customers? c) What price would the second firm have to offer to convert the 50" customer