Take the following demand function for a duopoly market for Firm X and Firm Y:

P=$1500-5Q

Assuming constant marginal cost for both firms of $375 and that market output is represented by the output of Firm X and Firm Y.

a)Calculate the output-reaction curves for Firms X and Y (show all workings)(4 marks)

b)Calculate the profit maximising level of output for each firm and the Cournot equilibrium market quantity and price.(4 marks)

c)Calculate the profit maximising level of output for Firm X assuming that it has first mover advantage in this market and correctly anticipates the output reaction curve of Firm Y.(2 marks)

d)Based on Part c) calculate the profit maximising level of output for Firm Y.(2 Marks)

e)Based on Part c) and Part d) calculate the equilibrium output and price in the market. (2 marks)