Two firms produce differentiated products and set prices to maximize their indiv

Two firms produce differentiated products and set prices to maximize their individual profits. Demand functions for the firms are given byQ1 =644P1 +2P2Q2 =505P2 +P1Where P1 P2 Q1 Q2 refer to prices and outputs of firms 1 and 2 respectively. Firm 1s marginal cost is $5 while firm 2s marginal cost is $4. Each firm has a fixed cost of $50.a) Assuming that the two firms decide on prices independently and simultaneously calculate the best response function of each firm in terms of prices.b) Calculate the resulting equilibrium price quantity combination for each firm.c) Illustrate the answer with a graph.d) Calculate optimal profits of each firm.