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In a one-shot game, if you advertise and your rival advertises, you will each earn RM5 million in profits. If neither of you advertises, your rival will make RM4 million and you will make RM2 million. If you advertise and your rival does not, you will make RM10 million and your rival will make RM3 million. If your rival advertises and you do not, you will make RM1 million and your rival will make RM3 million.
a. Write the above game in matrix table.
b. Do you have a dominant strategy?
c. Does your rival have a dominant strategy?
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Variable Costs (VC) These are costs, which vary with the level of production. The higher the level of production, the higher will be the variable costs. They are associated
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Total Cost (TC) This is the sum of fixed costs and variable costs i.e. TC = FC + VC.
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