Three department stores, A, B, and C, simultaneously decide whether or not to locate in a mall
Question:
a. Find the pure-strategy Nash equilibrium or equilibria of the game. You can apply the underlying method from the text as follows. First, find the best responses for A and B, treating each bold box corresponding to Cs choice as a separate game. Then find Cs best responses by comparing corresponding entries in the two boxes (the two entries in the upper-left corners of both, the upper-right corners of both, etc.) and underlining the higher of the two payoffs.
b. What do you think the outcome would be if players chose cooperatively rather than nonecooperatively?
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Related Book For
Intermediate Microeconomics and Its Application
ISBN: 978-0324599107
11th edition
Authors: walter nicholson, christopher snyder
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