Suppose there are 2 firms, (firm A, and firm B) that complete ala Cournot. Market demand is P = 150 - Q A+Q B 2 . Let marginal cost be MCA = 50and MCB = 50 (hence costs = 50Q) Assume monopoly with firm B sets QB = 0. Calculate firm A's. a) Optimal output b) Market price c) Monopoly profits d) Socially optimal level of output e) Deadweight loss (DWL) of the monopoly equilibrium? 5:23 pm

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