Question: Consider the following information for a simultaneous move game: If you advertise and your rival advertises, you each will earn 8 million in profits. If
Consider the following information for a simultaneous move game: If you advertise and your rival advertises, you each will earn million in profits. If neither of you advertises, you will each earn million in profits. However, if one of you advertises and the other does not, the firm that advertises will earn million and the nonadvertising firm will earn million. If you and your rival plan to be in business for only one year, the Nash equilibrium is
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for your firm to advertise and the other not to advertise.
for neither firm to advertise.
for the other firm to advertise and your firm not to advertise.
for each firm to advertise
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