Suppose that demand is given by P = 130 Q and marginal cost equals 10. Firms are Cournot competitors and play a supergame.

Suppose that demand is given by P = 130 − Q and marginal cost equals 10. Firms are Cournot competitors and play a supergame. The collusive agreement being considered is for each to produce half of the monopoly output. What is the critical discount factor to sustain collusion using grim punishment strategies if detection of deviation requires two periods?