2. Consider two rms (A and B) that produce the similar products, possibly}r with some degree of product differentiation. Because of brand loyalty, they face the following sym- metric demand curves: Q'qZIggpA-l-PB Q32122PB+R,1 In addition, MIC/1 : MICE : 2. (30 points) (a) First, consider the scenario when there is no product differentiation. What would be the Bertrand equilibrium price in this market? Illustrate your answer using a well-labeled graph. (13) I\\'ow, consider the scenario that there is product diHerentiatiorl. Solve for Firm A's price reaction function PA : f(PB), and for Firm B's price reaction function PB : f(PA). What are the optimal prices in the market? Calculate output for each rm. Illustrate your answer using a well-labeled graph. (c) Compare the results with no product differentiation in part (a) with those with prod- uct differentiation in part (b)