Scenario: Oligopoly. Suppose there are two firms that produce an identical product. The demand curve for their product is represented by P=60-2Q, where Q is the total quantity produced by the two firms. The marginal cost of production is zero and there are no fixed costs. 8. Refer to Scenario: Oligopoly. Suppose both firms choose their individual quantities q1 (firm 1) and q2 (firm 2) simultaneously and independently (so Q = q1 + q2). What is the unique Nash equilibrium price?

Refer to Scenario: Oligopoly. Suppose firm 1 must choose its quantity, q1, first. Player 2 observes this quantity, and then chooses its own quantity, q2. What is the unique subgame perfect Nash equilibrium? Identify one additional Nash equilibrium.