Two Large Universities, Humongous State (HSU) and Behemoth State (BSU)

Essay

Two large universities, Humongous State (HSU) and Behemoth State (BSU), dominate college basketball. Each basketball program aggressively recruits the best athletes to attend the university, but the best athletes can skip college and jump immediately to professional basketball. Each school can illegally pay top players to enroll and thus increase the winning percentage of the team, or each program can follow the rules and lose the top players to the professional ranks. The table shows the payoff matrix of winning percentages that each school would receive from its recruiting decision, given the recruiting decision of its rival. Winning percentages in each cell of the payoff matrix are given as (HSU, BSU).
A) What is the noncooperative Nash equilibrium?
B) Suppose each school considers the future and devises a tit-for-tat strategy. Neither school will pay players to play basketball so long as the other does not. If one school breaks the agreement and pays players, the other school will do the same until the first school stops paying players. If both schools adopt the tit-for-tat strategy, what are the winning percentages every year? Will this be effective at eliminating the illegal practice of paying college athletes to play basketball?