. a. (opts) Find all the Nash equilibrium. Explain why. ttach File Browse Local Files Browse Content Collection QUESTION 5 Consider a market in which market price is given by P =120 - 2Q where Q is the total output produced by all firms in the market. Suppose that there are two firms in this market and they are Cournot competitors. In this case, total output equals the sum of the two firms' outputs: Q = Q1 + Q2. Firm 1 has constant marginal cost of $20 and zero fixed cost, so its total cost function is 20Q1. Firm 2's total cost function is 50 + 10Q2. a. Derive Firm 1's reaction function. (4pts) b. Derive Firm 2's reaction function. (4pts) c. Find the Cournot equilibrium quantities and how much profit Firm 1 earns in equilibrium? (4pts) d. Suppose firm 1 acts as a leader to choose its output Q1 first. Then firm 2 chooses Q2 after observing firm 1's output level Q1. How much output will each firm produce in this Stackelberg model? (8pts) Attach File Click Save and Submit to save and submit. Click Save All Answers to save all answers. Save All Answers MacBook Pro Leave Share Screen 1 & * % V 9 O $ 8 @ # 4 5 6 2 3 Y U 0 E R T W K G H S N M X C 96