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You have two firms who are competing under a Cournot duopoly. They are producing homogenous goods. The inverse demand function is P = 200 -

You have two firms who are competing under a Cournot duopoly. They are producing homogenous goods. The inverse demand function is P = 200 - 1.4Q. Both firms have an identical cost structure which is: TC = 250 + 15q.

The firms have decided to form a monopoly through a horizontal merger. Calculate profit, assuming the merger occurs.

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