Reference no: EM132512701

Assignment: What is game theory, and how do businesses use games?

In your Managerial Economics textbook, we consider a sequential-move game in which an entrant is considering entering an industry in competition with an incumbent firm (see Figure 15-1). There are several possibilities of how this sequential game will be played. We want to use the Froeb rule of look ahead and reason back.

Instructions: For your discussion post, use Figure 15-1 from the textbook as your starting point to address the following:

• Can, and how does, the entrant succeed?

• Is the incumbent ever in control of this game?

You may wish to review the old game known as Duopoly, as well as Antoine-Augustin Cournot, to help inform your post.

Note: In your discussion posts for this course, do not rely on Wikipedia, Investopedia, or any similar website as a reference or supporting source.