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(4 pts) An industry consists of two firms producing an identical good, with demand curve D(p) and identical marginal costs c. Both firms are capacity-constrained,
(4 pts) An industry consists of two firms producing an identical good, with demand curve D(p) and identical marginal costs c. Both firms are capacity-constrained, with each firm having capacity K, where K > D(c). The firms compete in prices. What would happen to the equilibrium price and quantity if firm 1 were to invest in building more capacity? Explain your answer carefully but briefly
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