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3. Now suppose there are two rms in the market producing identical goods. Inverse market demand is still P = 120 Q + x/Z, but

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3. Now suppose there are two rms in the market producing identical goods. Inverse market demand is still P = 120 Q + x/Z, but now Q = q1 + (12. a. Solve for the Nash equilibrium in quantities if rm 1 is committed to advertising at A0 and rm 2 does not advertise. (This means that advertising is xed.) b. Now assume that rm 1 chooses quantity and advertising, while rm 2 chooses quantity alone. Assume all choices are made simultaneously. Solve for the Nash equilibrium quantities and level of advertising. c. Why does the monopoly level of advertising (question 2) differ from that of rm 1 in 3b

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