The inverse demand for a homogeneous-product stackelberg duopoly is p = 16,000 – 4q. the cost structures for the leader and the follower, respectively, are cl(ql) = 4,000ql and cf (qf) = 6,000qf.. a. what is the follower’s reaction function? qf = - ql b. determine the equilibrium output level for both the leader and the follower. leader output: follower output: c. determine the equilibrium market price.

Companies in the u.s. car rental market vary greatly in terms of the size of the fleet, the number of locations, and annual revenue. in 2011 hertz had 320,000 cars in service and annual revenue of approximately $4.2 billion. the following data show the number of cars in service (1000s) and the annual revenue ($ millions) for six smaller car rental companies (auto rental news website, august 7, 2012). excel file: data14-09.xls if required, enter negative values as negative numbers. a. select a scatter diagram with the number of cars in service as the independent variable. b. what does the scatter diagram developed in part (a) indicate about the relationship between the two variables? c. use the least squares method to develop the estimated regression equation (to 3 decimals). ŷ = + x d. for every additional car placed in service, estimate how much annual revenue will change. by $ e. fox rent a car has 11,000 cars in service. use the estimated regression equation developed in part (c) to predict annual revenue for fox rent a car. round your answer to nearest whole value. $ million hide feedback partially correct