Question: Final exam practice Question ] [CLO4, 8 Marks] Assume a market context where two companies only are present, company 1 and company 2. Company 1

Final exam practice Question ] [CLO4, 8 Marks] Assume a market context where two companies only are present, company 1 and company 2. Company 1 has the following costs: Fixed cost for company 1:30 Variable cost for company 1:3002 Company 2 has the following costs: Fixed cost for company 2:20 Variable cost for company 2=30Q2 They both share the following demand: Q=50-4P Questions: 1. Compute the optimal production for company 1 and 2. Assume there is no leader in the market [4 marks]; 2. Given the results you obtain at point 1, compute the prots for company 1 and 2 [2 marks]; 3-If one more company joins the market (assume with costs equal to company 1), and we still remain in a context where there is no market leader, what is the expected impact on optimal production and prots? Discuss [2 marks]. Question 2 [CLOSEHW

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