The above figure shows the payoff to two firms, A and B, of ...

[RODY.ELKHALIL]

The above figure shows the payoff to two firms, A and B, of releasing two versions of a new product. What is Firm A's best response if Firm B decides to release the high price version?
◦ Firm A does not have a best response strategy.
◦ Firm A chooses the low price version.
◦ Firm A chooses the high price version.
◦ Both low price and high price versions are best responses for firm A.

[bigsis44]

Firm A chooses the low price version.

[RODY.ELKHALIL]

Thanks

[bigsis44]

Welcome

[gonzo233]

The above figure shows the payoffs to two airlines, A and B, of serving a particular route. Is there a Nash equilibrium? What is it? Explain.

[patma1981]

Firm A entering and firm B not entering is the Nash equilibrium. Entering is firm A's dominant strategy. It will enter no matter what firm B does. Firm B does not have a dominant strategy but is always better off doing the opposite of firm A. Put in another way, given firm A's decision, if firm B enters, it will incur a loss.