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............ Suppose there are only two natural gas producers in Kabralkstan. In each period, rms determine how much natural gas to sell; market price is

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Suppose there are only two natural gas producers in Kabralkstan. In each period, rms determine how much natural gas to sell; market price is then determined by total demand and total supply. Marginal cost is given by 77 for Firm 1 and 74 for Firm 2. Currently, Firms 1 and 2 are producing 170 and 200, respectively, whereas market price is 94. By making an important discovery in the process of hydraulic fracturing (or \"frack ing\"), Firm 2 managed to cut its marginal cost from 74 to 68. (a) What impact do you expect Firm 2's cost reduction to have on its market share? Some studies suggest that Firm 2's new production process may not be environ mentally sound. (b) How much would Firm 1 be willing to pay in support of a campaign to (success fully) prevent Firm 2 from using its new fracking process

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