Sports authority and modell sporting are engaging

Assignment Help Macroeconomics

Reference no: EM13718718

Sports Authority and Modell's Sporting are engaging into the following one-shot game: if Sports Authority advertises and Modell's Sporting Goods does not, Sports Authority will make $20 million in profits and Modell's Sporting Goods will make $6 million. If Modell's Sporting Goods advertises and Sports Authority does not, Sports Authority will make $2 million and Modell's Sporting Goods will make $6 million. If Sports Authority advertises and Modell's Sporting Goods advertises, each firm earns $10 million. If neither firm advertises, Modell's Sporting Goods will make $8 million and Sports Authority will make $4 million.
(a) Write the payoff matrix for the above game.

(b) Does Sports Authority have a dominant strategy?

(d) What is the Nash equilibrium for the one-shot game?

Reference no: EM13718718

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