Consider an industry with 2 firms each having marginal cost


Consider an industry with 2 firms, each having marginal cost equal to zero. The inverse demand function facing this industry is

P(Y) = 100–Y

where Y = y1 + y2

If firm 1 as follower and firm 2 behaves as leader, calculate the Stackelberg equilibrium output.

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Business Economics: Consider an industry with 2 firms each having marginal cost
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