Question: 2. Rather than equal marginal costs as in Problem 1, suppose the marginal costs for the three firms are $ 2 5, $ 35 ,

2. Rather than equal marginal costs as in Problem 1, suppose the marginal costs for the three firms are $25, $35, and $45. The inverse demand curve remains Q = 100 P.

a. What is the unweighted average cost?

b. What is the price?

c. What is the total output produced by these firms?

d. What are each firms output and market share.

e. Please calculate H.

f. What is the weighted average cost?

g. Please calculate the Lerner index

h. What is the elasticity at the oligopoly price and output levels?

i. What is the product of the elasticity and the Lerner Index?

j. Please describe the similarities and differences between the Problem 1 and 2 results and provide an explanation for the similarities and differences you observed.

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