2. The following diagram shows the pricing strategies and payoffs for the two bubble gum firms in town. Long Lasting Flavor Co. Set high prices
2. The following diagram shows the pricing strategies and payoffs for the two bubble gum firms in town. Long Lasting Flavor Co. Set high prices Set low prices $250 $350 Set high prices $400 $200 Big Bubble Co. $100 $50 Set low prices $500 $150 Anderson/Ray, Krugman's Economics for the AP Course, 3e, @ 2019 Worth Publishers a. Does Big Bubble Co. have a dominant strategy? Explain. b. Does Long Lasting Flavor Co. have a dominant strategy? Explain. c. Does this situation have any Nash equilibria? Explain. (6 points)
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