4. Consider a market with two horizontally differentiated firms, X and Y. Each firm has a marginal cost of 20. They each face demand functions given by the following: QX = 100 – 2PX + PY QY = 100 – 2PY + PX. Calculate the Nash equilibrium prices. (Note: this is covered in the text and in Lecture 9).

Engberg company installs lawn sod in home yards. the company’s most recent monthly contribution format income statement follows: amount percent of sales sales $ 80,000 100% variable expenses 32,000 40% contribution margin 48,000 60% fixed expenses 38,000 net operating income $ 10,000 required: 1. compute the company’s degree of operating leverage. (round your answer to 1 decimal place.) 2. using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in sales. (do not round intermediate calculations.) 3. construct a new contribution format income statement for the company assuming a 5% increase in sales.