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In the Stackelberg competition situation, where the leader chooses its quantity first and the follower chooses its quantity after knowing about the leader's quantity. If
In the Stackelberg competition situation, where the leader chooses its quantity first and the follower chooses its quantity after knowing about the leader's quantity. If the leader's marginal cost decreases, comparing the new equilibrium with the old equilibrium, which of the following statement is correct.
- Equilibrium price might increase or decrease.
- The follower increases its production.
- The leader increases its production.
- Overall quantity is the same as before.
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