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Duopolists A and B face the following demand curves: QA = 100 2PA + 5PB and QB = 120 3PB + 4PA If both firms
Duopolists A and B face the following demand curves: QA = 100 2PA + 5PB and QB = 120 3PB + 4PA If both firms have zero marginal cost,
(a) Find the price best-response function for each firm.
(b) Draw a diagram that illustrates the best-response functions in part(a).
(c) What are the profit-maximizing prices and quantities?
(d) What is the profit of each firm?
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