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confused with this whole question Two firms, Firm 1 and Firm 2 are considering simultaneously developing a new product for a market. The costs of

confused with this whole question

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Two firms, Firm 1 and Firm 2 are considering simultaneously developing a new product for a market. The costs of developing the product are $7m but there will only be revenue in the market of $50m if only one of the firms develops the product. If both firms do not develop the product then there will be a total of $70m available in revenue from the market and Firm 1 will receive 70% of the market share and Firm 2 will receive 30% of the market share. a) Capture this entry game in a payoff matrix (5 Marks) b) What is the Nash equilibrium (2 Marks) C) Does either firm have a dominant strategy? (4 Marks)

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