Suppose there are two firms operating in the same market and compete over prices. the firms sell a differentiated product and their demand is given by Firm 1's demand: -1.5. P, + P2+ 123 Firm 2's demand: 0.5 -p, - 1.5 . P2+ 244 The firms' reaction function will be of the form p1 =A1 +a1 P2 and p2=A2+a2P1 where A1= and a1= A2= and a2= Are prices Snipping Tool OStrategic complements Ostrategic substitutes New Mode Select the snip mode using the What are the equilibrium prices in this market New button. P1= and p2= Snipping Tool is What are the quantities demanded from each firm In a future update, Snip 91= and q2= new home. Try improve What are the profits for each firm with Snip & Sketch (or Windows logo key + S T1= and T2= Try Snip & Sketch