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(a) Apple and Samsung are considering the price points for their latest smartphones. The game matrix below shows the profits earned by each firm in
(a) Apple and Samsung are considering the price points for their latest smartphones. The game matrix below shows the profits earned by each firm in millions of dollars for different prices (Apple's profit is the first entry in each cell): Samsung $1,000 $1,200 $1,900 $1,000 $180, $180 $130, $220 $150, $80 Apple $1,200 $220, $130 $150, $150 $110, $90 $1,900 $80, $150 $90, $110 $70, $70 (i) Find the Nash equilibrium/equilibria. (2 marks) (ii) Now, assume that Samsung is the first mover. Draw a game tree to obtain the Subgame Perfect Nash Equilibrium. (4 marks)
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