Question: Microsoft (OneDrive) and Box have to select storage amounts for their free accounts. As storage is costly, their profits will depend on how much they

 Microsoft (OneDrive) and Box have to select storage amounts for their

Microsoft (OneDrive) and Box have to select storage amounts for their free accounts. As storage is costly, their profits will depend on how much they offer, and what their rival is offering. Payoffs are: (Box, OneDrive). OneDrive Strategy 45 GB 30 GB 15 GB 45 GB 20,20 10,30 -4,36 30 GB 30, 10 24, 24 4, 32 15 GB 36,-4 32,4 30, 30 Box This time, the game played forever. Box adopts the following trigger strategy: Box will start by playing 15GB and play 15GB as long a OneDrive plays 15GB. If OneDrive ever plays 30GB or 45GB, then Box will play 45GB forever after. Assume that the interest rate (i) is 20%. What is OneDrive's payoff if it chooses a strategy to always: (1) Play 15GB. (2) Play 30GB. (3) Play 45GB. Show all work. 1 Microsoft (OneDrive) and Box have to select storage amounts for their free accounts. As storage is costly, their profits will depend on how much they offer, and what their rival is offering. Payoffs are: (Box, OneDrive). OneDrive Strategy 45 GB 30 GB 15 GB 45 GB 20,20 10,30 -4,36 30 GB 30, 10 24, 24 4, 32 15 GB 36,-4 32,4 30, 30 Box This time, the game played forever. Box adopts the following trigger strategy: Box will start by playing 15GB and play 15GB as long a OneDrive plays 15GB. If OneDrive ever plays 30GB or 45GB, then Box will play 45GB forever after. Assume that the interest rate (i) is 20%. What is OneDrive's payoff if it chooses a strategy to always: (1) Play 15GB. (2) Play 30GB. (3) Play 45GB. Show all work. 1

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