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Consider the market for vegan soup, where two firms, Kibble and Flesh Not, are in Stackelberg competition. Flesh Not observes Kibble's output level before choosing its desired output level. The market inverse demand curve for vegan soup is P: 18 - Q, where Q measures cups of soup produced by Kibble and Flesh Not, qr and qp, and P ls the price per cup. Kibble and Flesh Not produce soup at a constant marginal cost of $2.
a. Derive Flesh Not's reaction function.
b. Derive Kibble's marginal revenue function.
c. How much output does Kibble produce?
d. How much output does Flesh Not produce?
e. What is the market price of vegan soup?
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