In the model of a dominant firm, assume that the fringe supply curve is given by
Q = -1+0.2P, where P is market price and Q is output.
Demand is given by Q = 11-P.
What will price and output be if there is no dominant firm? Now assume that there is a dominant firm, whose marginal cost is constant at $6. Derive the residual demand curve that it faces and calculate its profit maxmizing output and price.