Show all steps please... 91) The market for an industrial chemical has a single dominant firm and a competitive fringePrice leadercomprised of many firms that behave as price takers. The dominant firm has recently begunbehaving as a price leader, setting price while the competitive fringe follows. The marketdemand curve and competitive fringe supply curve are given below. Marginal cost for thedominant firm is $0.75 per gallon.QM = 140,000 -32,000P marker Quantity demanded.QF= 60,000+ 8,000P,follower PerfectCOMPLwhere QM = market quantity demanded, and QF = the supply of the competitive fringe.Quantities are measured in gallons per week, and price is measured as a price per gallon.a. Determine the price and output that would prevail in the market under the conditionsdescribed above. Identify output for the dominant firm as well as the competitive fringe.b. Assume that the market demand curve shifts rightward by 40,000 units. Show that thedominant firm is indeed a price leader. What output (leader and follower) and market pricewill prevail after the change in demand?

The market demand curve is obtained by adding together the demand curves of the individual…

91) The market for an industrial chemical has a single dominant firm and a competitive fringe Price leader comprised of many firms that behave as price takers. The dominant firm has recently begun behaving as a price leader, setting price while the competitive fringe follows. The market demand curve and competitive fringe supply curve are given below. Marginal cost for the dominant firm is $0.75 per gallon. QM = 140,000 -32,000P marker Quantity demarded. QF = 60,000+ 8,000P, follower Perfee Cor where QM = market quantity demanded, and QF = the supply of the competitive fringe. Quantities are measured in gallons per week, and price is measured as a price per gallon.