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2. Now suppose that both firms are allowed to participate in both mar- kets as Cournot competitors. Will both firms produce? Find the equi- librium.

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2. Now suppose that both firms are allowed to participate in both mar- kets as Cournot competitors. Will both firms produce? Find the equi- librium. Calculate total consumer and producer surplus (across both markets). What happens to each? Calculate the Herfindahl index and the aggregate markup in the same way as before.There are two markets (e.g. corresponding to two different locations), each with demand function p = 100-Q. There are two firms, with marginal costs c1 = 0 and c2 = 60, respectively. Initially there is only one firm in each market

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