# Question

Two firms are planning to sell 10 or 20 units of their goods and face the following profit matrix:

a. What is the Nash equilibrium if both firms make their decisions simultaneously? What strategy does each firm use?

b. Draw the game tree if Firm 1 can decide first. What is the outcome? Why?

c. Draw the game tree if Firm 2 can decide first. What is the outcome?Why?

a. What is the Nash equilibrium if both firms make their decisions simultaneously? What strategy does each firm use?

b. Draw the game tree if Firm 1 can decide first. What is the outcome? Why?

c. Draw the game tree if Firm 2 can decide first. What is the outcome?Why?

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