Two firms, $\backslash ($ A $\backslash )$ and $\backslash ($ B $\backslash ),$ are deciding whether to engage in an advertising campaign. Advertising increases market share but reduces joint profit due to the costs involved. Their options are to Advertise or Not Advertise.

$\backslash$begin$\{$tabular$\}\{|$c$|$c$|$c$|\}$

$\backslash$hline & $\backslash$begin$\{$tabular$\}\{$c$\}$

Firm B: $\backslash \backslash$

Not Advertise

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$c$\}$

Firm B: $\backslash \backslash$

Advertise

$\backslash$end$\{$tabular$\}\backslash \backslash$

$\backslash$hline $\backslash$begin$\{$tabular$\}\{$c$\}$

Firm A: $\backslash \backslash$

Not Advertise

$\backslash$end$\{$tabular$\}$ & $\backslash ((6,6)\backslash )$ & $\backslash ((2,8)\backslash )\backslash \backslash$

$\backslash$hline $\backslash$begin$\{$tabular$\}\{$c$\}$

Firm A: $\backslash \backslash$

Advertise

$\backslash$end$\{$tabular$\}$ & $\backslash ((8,2)\backslash )$ & $\backslash ((3,3)\backslash )\backslash \backslash$

$\backslash$hline

$\backslash$end$\{$tabular$\}$

What is the Nash equilibrium in this game?

$\backslash ((3,3)\backslash )$ where both firms choose to advertise

$\backslash ((6,6)\backslash )$ where both firms choose not to advertise

$\backslash ((2,8)\backslash )$ where Firm A does not advertise and Firm B advertises

$\backslash ((8,2)\backslash )$ where Firm $\backslash ($ A $\backslash )$ advertises and Firm $\backslash ($ B $\backslash )$ does not