QUESTION 12 Consider a market of seven (7) equally-sized firms that compete through production. Market demand is P = 340- Q and each firm has a marginal cost of $20. What will be each INDIVIDUAL firm's quantity in this market? O q = 20 O q = 40 O q = 160 O q = 45.7 QUESTION 13 Consider a merger that transforms the market in the previous question to six (6) firms with one leader among them. What will be the expected INDIVIDUAL LEADER and INDIVIDUAL FOLLOWER quantities? O q(1) = 160; q(f) = 32 O q(1) = 320; q(f) = 32 O q(1) = 160; q(f) = 26.7 O q(1) = 320; q(f) = 26.7QUESTION 15 The merger referred to in the previous question should be profitable for the firms involved, if there were no costs associated with the merger. What would the costs have to be to make the merger unprofitable? O Merger costs will never make a merger unprofitable. The costs would need to be more than the difference between the merged firm's profit and the profit of an individual firm before the merger. O The costs would need to be more than the difference between the merged firm's profit and the profit of an two firms before the merger. O The costs would need to be more than the total of the merged firm's final profit. QUESTION 16 Consider a second merger that transforms the market to five (5) firms with two co-leaders among them. What will be the expected individual leader and follower quantities in this market? O q(1) = 120; q(f) = 20 O q(1) = 120; q(f) = 26.7 O q(1) = 106.7; q(f) = 20 O q(1) =106.7; q(f) = 26.7 QUESTION 17 To evaluate the profitability of a SECOND merger in the leader-follower model, we should compare: O the new co-leader profit to the profit of the leader before the merger O the new co-leader profit to the profit of two followers before the merger O the new co-leader profit to the new follower profit O the new co-leader profit to the profit of two followers in the original Cournot market