Kicking Horse's best-response function: 6112qT=qK Tim Horton's best response function: 5912qK=qT The Canadian retail market for roasted whole coffee beans is dominated by two firms: Tim Hortons (T) and Kicking Horse (K). The market demand function is given by P(Q)=640.5Q . Assume it is possible to produce partial units of output. Kicking Horse's marginal cost for each kg of roasted coffee beans is $3 . Tim Horton's marginal cost for each kg of roasted coffee beans is $5 (although they've been around longer than Kicking Horse, they've only recently expanded their product line for consumers to brew their own coffee at home). In Module 11's quiz, the firms revealed their output simultaneously. This week, suppose Kicking Horse gets to reveal their output first because of their incumbent status. Part (a): What is the Stackelberg market equilibrium (P and Q)? Part (b): How much did Kicking Horse's profits increase by when they went from being a Cournot duopolist to the Stackelberg leader