Problem 1.Suppose two countries, Canada and Japan are considering making computers. Firms in each individual country are identical and symmetric in their cost structures. It costs $5 Million to set up a computer production facility and then an addition $20 to make each computer individually, in either country. The price at which each firm can sell its computers is affected by the amount of firms it must compete with, and is given by the function: PP = 20 + 15 The initial market size in Japan is $ 3 Million and in Canada is $5.33 Million. a) Calculate the number of firms producing computers in each country in autarky. bj Calculate the price of computers in each country in autarky. c) If the two countries open up to trade and form one integrated market, what will be the number of firms and the price of computers in the world market? d) Calculate the responsiveness of a firm's sales to its price. Problem2. Suppose the fixed cost of producing computers rises to $15 Million. a) Recalculate your answers to parts a)-c) from Problem 1. Problem3. Suppose that the fixed cost is still $5 Million, as in question 1. However, now consider a third country, China, that is identical to Canada and Japan in production costs and demand for computers, but whose initial market size is $8 Million. a) Calculate the number of firms and market price of computers in China in autarky. p) Calculate the number of firms and market price of computers if China is integrated into the world market along with Canada and Japan