Question: Question 26 (4 points) Listen In a small town, two restaurants compete in the market for pizza. Each restaurant must decide whether to advertise or

Question 26 (4 points) Listen In a small town, two restaurants

Question 26 (4 points) Listen In a small town, two restaurants compete in the market for pizza. Each restaurant must decide whether to advertise or not. The potential monthly profits for these firms are shown below (in thousands of dollars). Restaurant A Advertise Don't Advertise 60 (A) 25 (A) Advertise 20 (B) 125 (B) Restaurant B 50 (A) 20 (A) Don't Advertise 50 (B) 60 (B) a) Does Restaurant A have a dominant strategy? If yes, what is it? Explain. (2 marks) a) Does Restaurant B have a dominant strategy? If yes, what is it? Explain. (2 marks)

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