Two firms compete as a Stackelberg duopoly. The demand they face is P = 24 - Q. The cost function for each firm is C(Q) = 4Q. The profits of the two firms are: A) π_L = $100; π_F = $50. B) π_L = $50; π_F = $25. C) π_L = $25; π_F = $12.5. D) π_L = $20; π_F = $10.

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The Answer of Two firms compete as a Stackelberg duopoly. The demand they face is P = 24 - Q. The cost function for each firm is C(Q) = 4Q. The profits of the two firms are: A) π_L = $100; π_F = $50. B) π_L = $50; π_F = $25. C) π_L = $25; π_F = $12.5. D) π_L = $20; π_F = $10.

Two Firms Compete as a Stackelberg Duopoly