Essay
Two large computer retailers, Best Buy and Circuit City, are considering entering a small town. Each firm can either enter the market or not. The table shows the payoff matrix. Profits in each cell of the payoff matrix are given as (Best Buy's profits, Circuit City's profits). Are there any dominant strategies in the game? If this game is played only once, and each firm decides whether to enter the market independently, what is/are the Nash equilibrium of this game? Explain your conclusions.
Correct Answer:
Verified
Correct Answer:
Verified
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