Question: Consider the following one-shot simultaneous game: Optus No change | Advertise No change 3, 6 0, 5 Telstra Discount 5 , 1 2, 2 New

 Consider the following one-shot simultaneous game: Optus No change | Advertise

Consider the following one-shot simultaneous game: Optus No change | Advertise No change 3, 6 0, 5 Telstra Discount 5 , 1 2, 2 New product 4, 2 4, 3 a. State all the dominated strategies in the (full) game, by which strategy they are dominated, and if strictly or weakly. Then solve the game by elimination of dominated strategies and briefly describe your reasoning in words. b. What are the pure strategy Nash equilibria of this game? Carefully explain your answer. If there is more than one, explain which one is more likely to be played, and why. c. Assume Telstra is the first mover (the Stackelberg leader). Solve the game by backwards induction, what is the equilibrium outcome? Explain your reasoning. Is Telstra's leadership an advantage or disadvantage for Telstra and Optus compared to the simultaneous game? Explain in one sentence why. d. ( ' ) Write the last digit of your student ID here _ and in the payoff matrix in the two spots under the strategies (B, E). Alice D E F A 11, 3 -1, 3 9, 3 Bob B 5, 13 Last digit, Last digit 3, -1 C 4, 5 -1, 6 12, 6 What is the equilibrium outcome by dominance? What is the equilibrium outcome under Alice's leadership? For each of these questions briefly explain your reasoning

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