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please help me do the E part. Q4. Bertrand (Price Competition) Model: Two firms are competing in the price competition model. The marked demand equation

please help me do the E part.

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Q4. Bertrand (Price Competition) Model: Two firms are competing in the price competition model. The marked demand equation is P=360-Q. Consumers only buy from the firm charging the lower price. If both firms charge the same price, they share the market equally, Both firms share the same marginal cost at 60, MC, =MC, 60 and there are no fixed costs. (29 points) A. If Firm 2 charges p2-50, then what price p, should Firm I charge? And briefly explain. (5 points) B: If Firm 1 charges p,=250, then what price p, should Firm 2 charge? And briefly explain. (6 points) C. Find the Nash equilibrium and explain your reason in detail. (7 points) D. Now suppose Firm 2's marginal cost is reduced to 50 but all the other conditions remain the same, Le. MC,=60, MC.=50. Find the new Nash equilibrium and exp. i, your reason. (6 points) E. Now suppose a new firm, Firm 3, enters this market to compete with a marginal cost also at 50, i.e., MC, =60, MC2=50, and MC,=50, and there are no fixed costs. The market demand equation is the same P-360-Q Consumers only buy from the firm charging the lowest price. If firms charge the same price, they share the market equally. Find the new Nash equilibrium and explain your reason. (5 points)

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