Consider a Stackelberg duopoly with the following inverse demand function: P = 100 ? 2Q1 ? 2Q2. The firms' marginal costs are identical and are given by MCi = 2. Based on this information, the Stackelberg follower's reaction function is:
A. QF = 24.5 ? 0.5QL.
B. QF = 24.5 ? QL.
C. QF = 49 ? 0.25QF.
D. QF = 24.5 ? 0.25QL.
Answer: A
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