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1. Consider a market of two (2) firms that produce the same thing. Market demand is P = 230 - Q and the marginal costs of production are $20 for Firm 1 and $10 for Firm 2. If firms compete through production, what will be the expected firm quantities? (Round to the tenth.)

A) Firm 1 = 66.7 units, Firm 2 = 76.7 units

B) Firm 1 = 76.7 units, Firm 2 = 66.7 units

C) Firm 1 = 73.3 units, Firm 2 = 70 units

D) Firm 1 = 70 units, Firm 2 = 73.3 units

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2. Using the outcomes from the previous question, which statement best explains the profit outcomes?

A) Firm 1 will generate more profit than Firm 2 because Firm 1 produces more and at a lower cost

B) Firm 2 will generate more profit than Firm 1 because Firm 2 produces more and at a lower cost

C) Firm 1 will generate more profit than Firm 2 because Firm 1 will sell at a higher price

D) Firm 2 will generate more profit than Firm 1 because Firm 1 will be forced to exit the market