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Consider the following Prisoner's Dilemma stage game, which is infinitely repeated between Firm 1 and Firm 2. Each firm can set a high price (PH)

Consider the following Prisoner's Dilemma stage game, which is infinitely repeated between Firm 1 and Firm 2. Each firm can set a high price (PH) or a low price (PL).

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5. Consider the following Prisoner's Dilemma stage game, which is innitely repeated between Firm 1 and Firm 2. Each rm can set a high price (PH) or a low price 031). Suppose that both rms are setting the high price. Does it pay either rm to cut its price? Assume tit-fortat reactions to price changes

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