Question: Hi please answer this question. i am struggling with it. 1. (10 Marks} Pizza Hut vs Domino's Pizza Hut and Domino's are considering to open

Hi please answer this question. i am struggling with it.

Hi please answer this question. i am struggling with it. 1. (10Marks} Pizza Hut vs Domino's Pizza Hut and Domino's are considering to

1. (10 Marks} Pizza Hut vs Domino's Pizza Hut and Domino's are considering to open a shop in a new shopping precinct in Burwood. Suppose both charge $10 for a pizza (price competition is ignored here}, and the aggregate local demand for pizza at this price is 6.1f both rms open a shop in the shopping precinct, 6 is shared equally between the two shops. On the other hand, if there is only one pizza shop in the shopping precinct, the total demand a goes to that shop. The total cost function for Pizza Hut is TCWQJ = 5Q + 6000, and the total cost function for Domino's is 1109(0) = 5Q + 6000. Each rm has two strategies: Open a shop or Not, and they make their decisions simultaneously. The payoff is zero nr a rm that does not open a shop in the shopping precinct. (a) (2 Marks) Suppose a = 3330. Construct a 2 x 2 payoff matrix for this entry game between Pizza Hut and Domino's and nd the NE of the game. (b) (2 Marks) Suppose = 2000. Construct a 2 x 2 payo' matrix for this entry game between Pizza Hut and Domino's and nd the NE of the game. (c) (3 Marks} Show that the entry game between Pizza Hut and Domino's bears the same features as the game of chicken when 1200 0.4, and only one rm will open a shop when p

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