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[30 points] Two firms, one and two, produce a homogeneous good at zero marginal cost. Demand in each period is D = 10A -5p. Firms

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[30 points] Two firms, one and two, produce a homogeneous good at zero marginal cost. Demand in each period is D = 10A -5p. Firms meet in the market repeatedly and expect to do so into the infinite future. They maximize present discounted profits. The discount factor is 8

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