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Read the following article regarding a recent dispute between Fox News and Dish Network https://goo.gl/nsF7L0 and use it to answer the following questions.
a. ) (7) Construct a dynamic game (with a game tree) in which Fox News is the first mover and Dish Network is the second mover. Fox News' has two potential strategies: 1) to increase the price they charge to Dish Network significantly (by 50%) or 2) increase price modestly (say, 10%). Dish Network then has the option to either Accept or Reject Fox News' offer. At the end of each branch create hypothetical payoffs to both firms - representing their change in profit from each possible outcome - to illustrate the outcome that is described in the article. Specifically, the Nash equilibrium to your game should be that Fox News increases price significantly and Dish Network accepts the offer. However, the payoffs to Dish Network would be highest if Fox News had increased price modestly.
This is an economic question on my weekly assignment that I am not sure how to approach.
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