Two firms compete in a Cournot market with:

Inverse demand curve:P = 120 - 2Q

MC = 60.

(a)(8 points) What is the equilibrium price and quantity if firms play the Nash Equilibrium?

(b)(4 points) If the two firms merge and MC does not change, what will be the equilibrium price and quantity?

(c)(4 points) How much would marginal costs need to fall in part (b) to leave consumer surplus unchanged?