Question 2 [Cournot + Stackelberg]: Consider the global market for crude oil, consisting of Saudi Arabia, Iran, and the rest of the world. Suppose that price-taking consumers in the rest of the world have demand for crude oil given by: P = 500 - YQ. Suppose that Saudi Arabia has marginal costs given by: P = 50 + XQ, And that Iran has marginal costs given by: P = 100 + 0.5Q. Assume that neither Iran nor Saudi Arabia has demand of their own. a. Suppose Saudi Arabia and Iran operate as a Cournot duopoly. For Y=0.75 and values of X from 0.01 to 0.99: plot - -sA on the y-axis , on the x-axis.' To this figure also plot LSA - 10 on the y-axis - on the x-axis. n's b. Suppose Saudi Arabia and Iran operate as a Stackelberg duopoly in which Saudi Arabia is the leader and Iran is the follower. For Y=0.75 and values of X from 0.01 to 0.99: plot - on the y-axis -,, on the x-axis. To this figure also plot - " on the y-axis LSA T on the x-axis. c. Compare the two sets of curves from a and b. Explain what you observe. d. Suppose Saudi Arabia and Iran operate as a Cournot duopoly. For X=0.25 and values of Y from 0.01 to 1.49: plot - - on the y-axis-, on the x-axis. To this figure also plot " on the y-axis - on the x-axis. n's