An industry has two firms producing at a constant unit cost of $10 per unit. The inverse demand curve for the industry is p = 100 - .5q. suppose that firm 1 is a Stackleberg leader in choosing its quantity (i. e. firm 1 chooses it's quantity first, knowing that firm 2 will observe firm 1's quantity when it chooses its own output.) How much output will firm 2, the follower, produce?

Lipman auto parts, a family-owned auto parts store, began january with $10,300.00 in cash. management forecasts that collections from credit customers will be $11,400.00 in january and $14,800.00 in february. the store is scheduled to receive $5,000.00 in cash on a business note receivable in january. projected cash payments include inventory purchases ($13,000.00 in january and $13,600.00 in february) and operating expenses ($2,700.00 each month). lipman auto parts' bank requires a $10,000.00 minimum balance in the store's checking account. at the end of any month when the account balance dips below $10,000.00, the bank automatically extends credit to the store in multiples of $1,000.00. lipman auto parts borrows as little as possible and pays back loans in quarterly installments of $2,000.00, plus 4 percent interest on the entire unpaid principal. the first payment occurs three months after the loan.