1.Otto has a monopoly on limousine service, and Carla is thinking about entering the market. The outcome of the entry-deterrence game represented by the game tree on the following page is that Otto...

1.Otto has a monopoly on limousine service, and Carla is thinking about entering the market. The outcome of the entry-deterrence game represented by the game tree on the following page is that Otto picks the
 quantity and Carla the market

2. Use the game tree in the previous exercise as a starting point. If the minimum entry quantity increases, a single number in one of the profit rectangles changes from $
 to a smaller number. If the relevant number is reduced by half, the new outcome of the entry-deterrence game is that Otto picks
the quantity and Carla
the market.

3.Consider a market with an insecure monopolist. The zero-profit quantity is 60 units and the minimum entry quantity is 5 units. The entry-deterring quantity is
units. The zero-profit price is $80. The slope of the market demand curve is - $2 per unit of output. The limit price is
 .