The relevant nickel market in the United Kingdom is a duopoly, in which NickelOne and NickelTwo compete simultaneously and independently. Their marginal and average cost is fixed and equal to AC = MC = 4. The inverse market demand function is equal to P = 10 - Q, where Q = q1 + q2. If both companies increase the cost for research and development (R&D) then the quantity offered is determined based on the Cournot oligopolistic model, otherwise the monopoly effect or collusion effect is achieved. If one increases R&D expenditure and the other decreases then the price is determined based on the Bertrand oligopolistic model.

Find the Nash equilibrium.