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1. Aardvark and Bambi are the only manufacturers of dolls, and they compete to share the market. Aardvark and Bambi have identical technologies, and the marginal cost and average cost of production for each is $25. Demand for dolls is described by P=85-4Q. Answer with all work shown and explanation if necessary.
a. What are the marginal revenue functions for Aardvark and Bambi?
b. Find the optimal quantity produced by each firm. Show all work associated
c. What is the profit earned by each firm at that production level?
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