Suppose mountain spring water can be produced atno cost(i.e. MC = 0)and that the demand and marginal revenue curves for mountain spring water are given as follows:

P = 1200 - 0.2QMR = 1200 - 0.4Q

(a) Assume Spring Water behaves as a monopoly. What is the profit maximizing price?

(b) Now assume there are two identical firms (i. e. a Cournot duopoly). What is the profit maximizing price it will charge?