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The table below shows the payoff matrix that represents the strategic interaction between Pepsi and Coca-Cola. As a major festive holiday is coming up soon, the two companies are deciding between two advertising strategies. The payoffs in the matrix below are provisional estimates of their subsequent net quarterly profits in millions of dollars.
Coca-Cola
Low spend
High spend
Pepsi
200, 200
-50, 255
265, -100
60, 50
Select all the correct answers.
Group of answer choices
If this is a repeated game, it is more likely that both companies would agree to only have a low spend on advertising compared to a one-shot game
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If Pepsi only had a low spend on advertising, Coca-Cola could make a net quarterly profit of $255 million
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