1. Suppose that CableNorth and CableSouth are independently deciding between two pricing strategy, Advertising and No Advertising. The following payoff matrix shows the profits per year for each company resulting from the interaction of their strategies.

a) Briefly explain whether CableNorth has a dominant strategy. b) Briefly explain whether CableSouth has a dominant strategy. c) Briefly explain whether there is a Nash equilibrium in this game.

Figure: Pricing Strategy in Cable TV Market 1 CableNorth Advertising No Advertising CableNorth earns $100,000 CableNorth earns $70,000 Advertising CableSouth earms S100,000eams S130,000 CableSouth CableNorth earns $130,000 CableNorth earns $150,000 C0 No AdvertisingCableSouth CableSouth eams $70,000eams $150,000