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  • Exercise 1. Nash Equilibrium

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    Elisa Paredes
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    8 views1 page

    Exercise 1. Nash Equilibrium

    Uploaded by

    Elisa Paredes

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    Old Business

    Advertise Not Advertise

    60, 35 85,0
    Advertise

    New Business
    40,50 100,0
    Not Advertise

    A new business is deciding whether to advertise or not its products while an old business
    already established and well known in the region is also deciding whether to advertise or
    not based on what they know about the competence. The numbers in the chart represent
    the profit after advertising.

    If you work for “New business” what do you think you should do?
    What is the Nash equilibrium?

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