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1. Two opposing armies, Red and Blue, must each decide whether to attack or defend. These decisions are made without knowledge of the opposing army's

1. Two opposing armies, Red and Blue, must each decide whether to attack or defend. These decisions are made without knowledge of the opposing army's decision. The payoff table, in terms of value of property gained or lost for the Red Army, appears below. Any gains for the Red Army are losses for the Blue Army

Red Army

Blue Army
Attack Defend
Attack 35 40

Defend

50

20

a. What is the optimal mixed strategy for the Red Army?

b. What is the optimal mixed strategy for the Blue Army?

2. A computer rework center has the capacity to rework 300 computers per day. The expected number of computers needing to be reworked per day is 225. The center is paid $26 for each computer reworked. The fixed cost of renting the reworking equipment is $250 per day. Workspace rents for $150 per day. The cost of material is $18 per computer and labor costs $3 per computer.

a. draw the expression for the total cost.
b. draw the expression for total revenue.

c. Present the break-even chart graphically.

d. What is the break-even number of computers reworked per day?

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