Question: Traditionally the Harrison Resort Hotel sponsors an annual festival making

Traditionally, the Harrison Resort Hotel sponsors an annual festival, making a significant investment in marketing to attract tourists to its hotel. Julie, the manager to nearby Lakeshore Flowers, normally orders extra merchandise in preparation for the festival. However, Harrison was recently bought by a large chain, so its management has changed. Julie is not sure that the new manager knows that investing in marketing will benefit Harrison

a. What is the Nash equilibrium in this game?
b. What can Julie do to make sure that Harrison’s new manager does what’s best for the resort (and also best forher)?
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  • CreatedNovember 13, 2014
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