Let demand for car batteries be such that Q = 10 − 2P. Assume constant marginal costs of 3. Compute the equilibrium price, quantity, consumer surplus, producer surplus for
(a) Assume one of the two firms has a marginal cost of 3. What is the oligopoly outcome in this case? [Hint you can’t use the trick we used to get a second equation.] (e) (Hard question) Suppose a discount factor of 0.99 and a duopoly structure on agreements. What is the Pareto frontier of agreements that may form the basis of a cartel?