This question refers to the following game in strategic form, where each cell shows the profits accruing to Lightning Industries and Maximum Power:

		Maximum Power
		Build	Don’t Build
Lighting	Build	L: $90 M: $90	L: $120 M: $70
	Don’t Build	L: $70 M: $120	L: $95 M: $95

The Nash equilibrium of this game is:

a. Lighting builds new capacity, while Maximum Power does not

b. Both companies build new capacity

c. Maximum Power builds new capacity, while Lightning does note. 

Both companies don’t build

Answer rating: 100% (QA)

Note that a For Lighting Industries the strategy do not bu... View the full answer