Consider a market with 3 firms and the following demand from consumers P = 110-Q. Each independent firm has the same fixed cost F but different constant marginal costs: c = 5, c = 5, and c = 4. There is no capacity constraint.

(a) What is the market equilibrium of this oligopoly (prices, quantities, benefits, consumers surplus, total surplus)? (b) Consider that firms 2 and 3 merge. What is the market equilibrium after the merger? (c) What are the consequences of such a merger? How does it depend on F ?