Question: how do I solve parts c & d? 2) Suppose that Espresso and Beantown are the only two firms that sell coffee. The following payoff

how do I solve parts c & d?

2) Suppose that Espresso and Beantown are the only two firms that sell coffee. The following payoff matrix shows the profit (in millions of dollars) each company will earn depending on whether or not it decides to advertise (Espresso's payoffs are on the left and Beantown's on the right). Beantown Advertise Don't Advertise Espresso Advertise 10, 10 18, 2 Don't Advertise 2, 18 11, 11 A) Assume Espresso decides to advertise. How much will Beantown earn if it also decides to advertise? How much will Beantown earn if it decides not to advertise? If Espresso decides to advertise, it will earn profit of $10 million if Beantown advertises, and a profit of $18 million if Beantown doesn't advertise. B) Now assume Espresso decides not to advertise. How much will Beantown earn if it decides to advertise? How much will Beantown earn if it decides not to advertise? If Espresso decides not to advertise, it will earn a profit of $2 million if Beantown advertises, and a profit of $11 million if Beantown doesn't advertise. C) What is the dominant strategy in this game? Can this strategy be improved upon? Explain. D) Suggest ways that would make it easier for Espresso and Beantown to reach a cooperative behavior

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