In Promaine Flats, Nevada there were two restaurants: Sal Monella and Road Kill Cafe. Current profit is $7,000 each. Cleaning will attract more customers, but profit will reduce to $5,000 each. However, if one cleans up and other doesn't then profit will be $12,000 and $3,000. 

1. Complete the payoff matrix above. 

2. What is each players dominant strategy Explai

3. What is the each players dominant strategy Explain

Transcribed Image Text:

Sal Monella (SM) Clean up Doesn't clean up SM= SM= RK= RK= SM= SM= RK= RK= Road Kill Café (RK) Doesn't dean up Clean up Sal Monella (SM) Clean up Doesn't clean up SM= SM= RK= RK= SM= SM= RK= RK= Road Kill Café (RK) Doesn't dean up Clean up

Answer rating: 100% (QA)

1 2 The dominant strategy for each firm is the clean up strategy Sal Monella SM We consider the firs... View the full answer