If Firm 1 thinks Firm 2 will produce 50 units,its demand curve, D (50),is shifted to the left by this amount.Profit maximization now implies an output of 25 units. Finally,if Firm 1 thinks Firm 2 will produce 75 unit,Firm 1 will produce only 12.5 units.If Firm 1 thinks Firm 2 will produce 50 units, its demand curve, Dl (50), is shifted to the left by this amount. Profit maximization now implies an output of 25 units. Finally, if Firm 1 thinks Firm 2 will produce 75 unit, Firm 1 will produce only 12.5 units