Problem 2: Raising Rivals' Costs (25 points). Imagine a situation with three producers of milk (A, B, C) and three producers of ice cream (1, 2, 3). Milk is perfectly homogeneous and only used as an input to ice cream production (which is also homogeneous). Producers A, B, and C have different marginal costs of producing milk: MCA 2 20, MOB = 30, and M03 = 40. For each ice cream producer, the cost of ice cream production is equal to the price of milk Pm plus a constant conversion cost: M C4,, 2 AC,(, 2 Pm + 20 a) With no integration, from which rm will 1, 2, and 3 buy milk? What price of milk (per Imit] will each rm pay? What is the price of ice cream (per unit} for ice cream consumers? 1)) Suppose that rm 1 merges with rm A and they deal exclusively with one another. Horn which rm will 2 and 3 buy milk? What price of milk will 2 and 3 pay? c) What is the mst of ice cream production for 1? What is the cost of ice cream production for 2 and 3? What is the price of ice cream for ice cream consumers? d) Briey describe the relevant anticompetitive concern(s] associated with vertical inte gration in this case