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Q6. The market demand curve for widgets is given by P = 100 - 2Q. Suppose that there are two firms that produce widgets, and

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Q6. The market demand curve for widgets is given by P = 100 - 2Q. Suppose that there are two firms that produce widgets, and each has a constant marginal cost of $16 per unit. For each of the questions below, give the market outcomes (equilibrium price and quantity, and where the firms produce different quantities, the quantity for each firm). a) If the two firms are Bertrand competitors, what will be the market outcomes? [2 marks ] b) If the two firms are Cournot competitors, what will be the market outcomes? [4 marks] c) If the two firms are Stackleberg competitors, what will be the market outcomes? [4 marks]

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