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Calculate Cournat equilibrium price and quantity and Stakelberg equilibrium price and quantity and compare consumer and producer surplus given market demand curve with zero marginal cost.

Two identical firms face linear demand. Market demand is given by P=30-Q. Suppose
both firms face zero marginal costs.
1. Solve for Cournot equilibrium prices and outputs.
2. Solve for Stakelberg equilibrium prices and outputs.
3. Compare graphically consumer and producer surplus in Cournot and Stakelberg
equilibria to perfect competition.

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