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12. This gure displays the choices and payoffs (company prots) of two music shops-MiiTunes and The Rock Shop. MiiTunes is an established business in the
12. This gure displays the choices and payoffs (company prots) of two music shops-MiiTunes and The Rock Shop. MiiTunes is an established business in the area deciding whether to charge its usual high prices or to charge very low prices, in the hopes that a new business will not be able to make a prot at such low prices. The Rock Shop is trying to decide whether or not it should enter the market and compete with MiiTunes. MiiTunes Low Prices High Prices Enter $2 million $4 million The Rock Shop $5 million 510 million $0 million Do not enter According to the gure, The Rock Shop: A. should enter the market. B. should not enter the market, regardless of what MiiTunes chooses to do. (3. does have a dominant strategy
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