There is a given rent of R > 0. Each of two players spends resources competing for the rent. If player 1 spends x1 0 and player 2 spends x2 0 the probability that player 1 wins the rent is p1 = x1 x1+x2 , where > 1, and player 2's winning probability is p2 = 1 p1. (a) Derive and draw the two players' best-response functions. Discuss the effect of changing on the best-response functions. [20 marks] 1(b) How much will each player spend on lobbying in Nash equilibrium? [10 marks] Which player is more likely to win the rent? [5 marks] (c) How does the total equilibrium spending depend on ? Discuss. [10 marks]