Pricing. The demand schedule is (Price of 12-pack) and assumes that Coke and Pepsi are perfect substitutes for the consumer.

Profitability. The annual accounting profit (in millions of dollars) is given by total revenue minus total cost. For Coke, the variable cost of producing one 12-pack is $2. The annual fixed cost for the Coke corporation is $750 million. For Pepsi, we believe that the variable cost of producing one 12- pack is $2. The annual fixed cost for the Pepsi corporation is $500 million.

question

What are Coke and Pepsi profits at the quantities where these two curves intersect? Show your calculations. What is the price P of 12-packs at those quantities?

Your compilation of the thoughts of Coke managers (in millions of 12-packs per year) \begin{tabular}{|l|l} \hline If Pepsi's choice is ... & Coke's response is ... \end{tabular} Derived from a Survey of Pepsi management What is Pepsi's best response? A survey of the Pepsi management. \begin{tabular}{|r|r|r|r|} \hline & (in millions of 12-packs per year) \\ \hline & & \\ \hline If Coke's choice is ... & \\ \hline 100 & & Pepsi's response is \\ \hline 200 & & 1300 \\ \hline 300 & & 1250 \\ \hline 400 & & 1200 \\ \hline 500 & & 1150 \\ \hline 600 & & 1100 \\ \hline 700 & & 1050 \\ \hline 800 & & 1000 \\ \hline 900 & & 950 \\ \hline 1000 & 900 \\ \hline 1100 & & 850 \\ \hline 1200 & & 800 \\ \hline 1300 & & 750 \\ \hline 1400 & & 700 \\ \hline 1500 & & 650 \\ \hline 1600 & & 600 \\ \hline 1700 & & 550 \\ \hline 1800 & & 500 \\ \hline 1900 & & \\ \hline 2000 & & \\ \hline \end{tabular} Your compilation of the thoughts of Coke managers (in millions of 12-packs per year) \begin{tabular}{|l|l} \hline If Pepsi's choice is ... & Coke's response is ... \end{tabular} Derived from a Survey of Pepsi management What is Pepsi's best response? A survey of the Pepsi management. \begin{tabular}{|r|r|r|r|} \hline & (in millions of 12-packs per year) \\ \hline & & \\ \hline If Coke's choice is ... & \\ \hline 100 & & Pepsi's response is \\ \hline 200 & & 1300 \\ \hline 300 & & 1250 \\ \hline 400 & & 1200 \\ \hline 500 & & 1150 \\ \hline 600 & & 1100 \\ \hline 700 & & 1050 \\ \hline 800 & & 1000 \\ \hline 900 & & 950 \\ \hline 1000 & 900 \\ \hline 1100 & & 850 \\ \hline 1200 & & 800 \\ \hline 1300 & & 750 \\ \hline 1400 & & 700 \\ \hline 1500 & & 650 \\ \hline 1600 & & 600 \\ \hline 1700 & & 550 \\ \hline 1800 & & 500 \\ \hline 1900 & & \\ \hline 2000 & & \\ \hline \end{tabular}