The market for energy drinks is emerging, and there are two firms entering the market. They face a total

market demand of Q=400-p, and marginal cost of MC = 20, Assume the firm Monster Energy enters the

market first, and a few months later the firm Rockstar enters. This makes Monster the leader and Rockstar the

follower.

a. Solve for the marginal revenue curves for each firm

b. Solve for the Stackelburg-Nash equilibrium quantities for each firm, given the above information.

Indicate the total market quantity and price.

c. Graph the market in equilibrium, showing Monster's residual demand curve and marginal revenue

curve, the marginal cost curve, and the total market demand curve.

d. How does a Stackelburg-Nash equilibrium compare to the Cournot-Nash equilibrium, in terms of

quantity produced and price, generally?