2) The market demand is Q(P) = 10-P. There are two firms in the market and they compete in the style of Cournot. Firm 1 has an advanced technology, its cost function is c(q,) = q,. Firm 2 has an old technology, its cost function is c(q,) = 4q.. Firm 1 makes the following offer to Firm 2: "You can use my technology if you pay me $r for each unit you produce." Note that if Firm 2 accepts the offer, its total cost will be c(q,) = q, + rq.. a. Show that by choosing r carefully, Firm 1 can make more profits. (Hint: What is the highest r that is acceptable to Firm 2? If Firm 2 rejects the offer, it will use the old technology c(q,) = 4q,.) b. Is this agreement socially desirable? Is social welfare higher with the licensing agreement or without it? Should the government allow this deal to go through or stop it