During its first year of operations, drone zone corporation (dzc) bought goods from a manufacturer on account at a cost of $69,000. dzc returned $9,900 of this merchandise to the manufacturer for credit on its account. dzc then sold $57,000 of the remaining goods at a selling price of $83,600. dzc records sales returns as they occur and then records estimated additional returns at year-end. during the year, customers returned goods that had been sold at a price of $8,700. these goods were in perfect condition, so they were put back into dzc’s inventory at their cost of $5,900. at year-end, dzc estimated $10,910 of current year merchandise sales would be returned to dzc in the following year; dzc estimates $7,200 as its cost of this merchandise. prepare journal entries to record dzc’s transactions and estimates, assuming dzc uses a perpetual inventory system. (

1. consider a two-firm industry. firm 1 (the incumbent) chooses a level of output qı. firm 2 (the potential entrant) observes qı and then chooses its level of output q2. the demand for the product is p 100 q, where q is the total output sold by the two firms which equals qi +q2. assume that the marginal cost of each firm is zero. a) find the subgame perfect equilibrium levels of qi and q2 keeping in mind that firm 1 chooses qi first and firm 2 observes qi and chooses its q2. find the profits of the two firms-n1 and t2- in the subgame perfect equilibrium. how do these numbers differ from the cournot equilibrium? b) for what level of qi would firm 2 be deterred from entering? would a rational firm 1 have an incentive to choose this level of qi? which entry condition does this market have: blockaded, deterred, or accommodated? now suppose that firm 2 has to incur a fixed cost of entry, f> 0. c) for what values of f will entry be blockaded? d) find out the entry deterring level of q, denoted by q1', a expression for firm l's profit, when entry is deterred, as a function of f. for what values of f would firm 1 use an entry deterring strategy?