Excalibur and Luxor compete in the Las Vegas Strip hotel market. Daily demand for the number of rooms (in thousands) at just these two hotels (i.e., qtotal) is given by P(qtotal) = 740 - 60 qtotal , For both hotels, the marginal cost of having a room occupied is a constant $20. The hotels simultaneously choose their capacities (q, and qg for Luxor and Excalibur, respectively). For simplicity, assume these are the only two hotels in the market and that there are no fixed costs. Are the following statements TRUE or FALSE? 1. The Cournot best-response function for Luxor is qi(qE) = 12 - qE/2. 2. At the Cournot equilibrium, both hotels will choose a capacity of 8 (thousand) rooms. 3. The Cournot equilibrium price is $260. 4. If the two hotels had merged prior to choosing their capacities, they would have provided more total hotel rooms than in the Cournot equilibrium. 5. Assuming no cost synergies, if the two hotels had merged prior to choosing their capacities, they would not have increased their joint profit relative to what they make under Cournot competition