Question: Question 6) (Only when there is still time in class) Suppose that Big W and Kmart are competing on whether to stick with barcodes or

 Question 6) (Only when there is still time in class) Suppose

Question 6) (Only when there is still time in class) Suppose that Big W and Kmart are competing on whether to stick with barcodes or switch to radio frequency identification (RFID) tags to monitor the flow of products. Because many suppliers sell to both Big W and Kmart, it is much less costly for suppliers to use one system or the other, rather than to use both. The following payoff matrix shows the profits per year for each company resulting from the interaction of their strategies. Kmart Bar codes RFID tags Big W earns Big W earns Bar codes $4 billion $1 billion Kmart earns Kmart earns $3 billion $2 billion Big W Big W earns Big W earns RFID tags $3 billion $2 billion Kmart earns Kmart earns $1 billion $4 billion a. Explain whether Big W has a dominant strategy b. Explain whether Kmart has a dominant strategy c. Briefly whether there is a Nash equilibrium in this game

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