Hi, please help with the following question. Thank you.

3. Assume that if two firms merge, the merged firm will be able to act as an industry leader, making its output decision before the non- merged firms make theirs. Further assume that y = 0 so that the firms are of equal efficiency. a. Confirm that a merger between firms 1 and 2 will now be profitable. What has happened to the profits of the non- merged firms and to the product price as a result of this merger? b. Confirm that the two remaining firms will also want to merge and join the leader group given that the leaders act as Cournot competitors with respect to each other (hint: this merger will cre- ate a leader group containing two firms and a follower group containing none). What does this second merger do to the market price