Consider the market for new homes in the famous town of Waddy, Florida. There are two builders of homes, Kerr and Terry. The demand for building new homes is characterized by the following equation: P = 2100 - K - T, where K refers to the number of homes to be built by Kerr and T represent the number of homes to be built by Terry in a year. Both Kerr and Terry have a marginal cost equal to average cost of 100 per home built at all levels of output. . a. (60 points) In this market Kerr chooses the number of homes to build first and Terry chooses the number of homes to build second. They are building on speculation of the future demand for homes, which means that the market price will not be set until the homes are finished and marketed. While showing your work, describe the following features of the Nash equilibrium: 1) the quantities that each firm will choose, 2) the market price for homes, and 3) the profits that each firm will earn.b. (40 points). Consider a situation where Kerr has a marginal cost=average cost at all levels of output equal to 100 and Terry has a marginal cost=average cost of 100 at all levels of output. Kerr still moves first and this is a Bertrand situation where the firms are choosing price and the firm with the lower price wins the market. If they have the same price, the firms split the market. In the Nash Equilibrium describe 1. the market price that we will see 2. the quantities that each firm will produce, 3. and the profits that each firm will receive. Make sure to explain why you choose these values and show your work. c. In which situation a) or b) are consumers better off? Explain your answer. (20 points)