Suppose there are 100 residents uniformly-spaced living on a 10-km long street. Each resident has a willingness to pay for pizza of $30 and would buy 1 pizza per week. It costs a resident $1 to travel one km. The marginal cost for each pizza shop is $5 per pizza and there is no fixed cost. Assume price setting behavior. a) Assume that those two shops are located just in the middle of the street. What will be the equilibrium price? What will be the profits of these two shops? b) Assume that pizza shops are located on opposite ends of the street. Derive the demand functions (as a function of other firms' price) and find the prices charged by each firm. Find the profits of the shops. c) Assume that there is a potential entrant. What is the best location for the entrant? Why?