Consider a price competition game between two manufacturing firms, American Paper Optics (APO) and Thousand Oaks Optical (TOO), each of which sells solar eclipse glasses. Each player can set the price to be $5 or $3 for a pair of glasses. If they both set a high price, each receives profits of $16,000 per year. If they both set a low price, each receives profits of $14,000 per year. If one sets a low price and the other sets a high price, the low-price firm receives profits of $18,000 per year while the high-price firm receives profits of $5,000 per year.

1. What are the Nash equilibrium strategies and payoffs in the one-shot simultaneous game if the two firms make price decisions only once?