Consider two firms, Firm A and Firm B, who compete as duopolists. Each firm produces an identical product. The total inverse demand curve for the industry is = 250 − ( + ). Firm A has a total cost curve ( ) = 100 + 2 . Firm B has a total cost curve ( ) = 100 + 2. a. Suppose for now, only Firm A exists ( = 0). What is the Monopoly equilibrium quantity and price? What is Firm A's profit? b. Find the Nash Cournot equilibrium price and output level. What are the firms' profits? c. Find the equilibrium price and output level in the market if firm A acts as a Stackelberg leader. What are the firms' profits? d. Suppose that the two firms are able to form a cartel. Derive the output each firm will produce, the market price, and the total profit under the cartel solution. e. Compare the Cournot, Stackelberg, and Cartel outcomes to the monopoly outcome you calculated in part a.

Northern lights electronics just completed plans to distribute its new tablet. the product has several unique features that differentiate it from competitor products. the marketing team plans to begin a roll-out with to only one traditional retailer for the first two months. this strategy will give consumers the perception of the product’s stand-out personality and increase demand. marketing will proceed with for the next four months, where it plans to distribute to three other retailers, as well. for the last six months of the year, it will initiate distribution agreements with discount retailers and online retailers, and any other electronics store that wants to carry it. the marketing team is confident that the tablet will cycle through the first three stages of its product life cycle quickly. as the tablet reaches maturity during the second half of its first year in the market, it is good strategy to proceed with as described above. intensive distribution; selective distribution; exclusive distribution exclusive distribution; selective distribution; intensive distribution tertiary level distribution; secondary level distribution; mono-level distribution mono-level distribution; secondary level distribution; tertiary level distribution