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Consider the price strategy of Delta Airlines for its Detroit-to-Philadelphia route. In this game spirit is a potential competi...Asked by Tinu
Consider the price strategy of Delta Airlines for its Detroit-to-Philadelphia route. In this game spirit is a potential competitor along the same route. Spirit will make competitive profits on less-popular routes if it does enter the market for this service. The matrix representing this game is as follow:
Delta
Low Fare High Fare
Spirit Enter 0,0 5,10
Stay out 2,20 2,25
1.Is there a dominant strategy for either of the two companies? If so, what is the respective strategy?
2.Is there unique Nash equilibrium? If so what is it?
Delta
Low Fare High Fare
Spirit Enter 0,0 5,10
Stay out 2,20 2,25
1.Is there a dominant strategy for either of the two companies? If so, what is the respective strategy?
2.Is there unique Nash equilibrium? If so what is it?
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