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Consider a two-firm oligopoly facing a market inverse demand curve of P = 100 – 2Q,...

Consider a two-firm oligopoly facing a market inverse demand curve of P = 100 – 2Q, where Q is the sum of q1 and q2. q1 is the output of Firm 1 and q2 is the output of Firm 2. Firm 1's marginal cost is constant at $12, while Firm 2's marginal cost is constant at $20. Answer the following questions, assuming that the firms are Cournot competitors.

a. How much output does each firm produce? (answer is q1 = 16 and q2 = 12, but still show the work please)

b. How much profit does each firm earn?

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