You are a senior analyst at an oligopolistic firm, which is considering its output strategy, which is to be announced simultaneously as that of its rival oligopolistic firm. You have the following information:

The market demand equation is P = 40 - Q where Q = Q₁ + Q₂. Q₁ and Q₂ refer to the output level of your firm and your rival's firm respectively. Thus, the expanded demand equation is P = 40 - Q₁ - Q₂.

The marginal cost for your firm is 5, and 8 for your rival.

You are tasked, by your supervisor, with

1. identifying the output level your firm will set (Q₁) under the Cournot Model scenario.

2. explain why this outcome is better than that of the Stackelberg Model outcome if your firm moves second in a sequential game.