In mid-2012, Saudi Arabia and Venezuela (both members of OPEC) produced an average of 8 million and 3 million barrels of oil a day, respectively. Production costs were about $20 per barrel, and the price of oil averaged $80 per barrel. Each country had the capacity to produce an extra 1 million barrels per day. At that time, it was estimated that each 1-million-barrel increase in supply would depress the average price of oil by $10.

a. Fill in the missing profit entries in the payoff table.

b. What actions should each country take and why?

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Venezuela 3 M barrels 4 M barrels 8 M barrels 9 M barrels Saudi Arabia ,