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Consider a Strategic Trade and Industrial Policies (Boeing vs. Airbus) with Game Theory. The following matrix describes the payoff structure of the game: Airbus

 


Consider a Strategic Trade and Industrial Policies (Boeing vs. Airbus) with Game Theory. The following matrix describes the payoff structure of the game: Airbus Don't Produce Produce Produce -10, -10 100,0 Boeing Don't Produce 0, 100 0,0 a. Suppose that the European government provides export subsidy of 15 to Airbus. What would the new matrix look like? Please draw the new matrix with updated payoffs. b. How would this change the solution to the game? Find the dominant strategies (if any), and Nash equilibrium in this Game. c. What is the actual outcome of this game?

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a With a European export subsidy of 15 to Airbus the new payoffs would be as follows Airbus Produce ... blur-text-image

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