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Firm B Frequent buyer program No frequent buyer program Firm A Frequent buyer program 400 ; 320 680 ; 160 No Frequent buyer program 320

Firm B Frequent buyer program No frequent buyer program Firm A Frequent buyer program 400 ; 320 680 ; 160 No Frequent buyer program 320 ; 280 480 ; 400 i) Determine whether each firm has a dominant strategy. (4 marks) ii) Find the Nash equilibrium in this game. (3 marks) iii) Can you describe this game as an example of the prisoners' dilemma? Explain. (3 marks) iv) Suppose Firm A could move first, determine sequential, the optimal strategy

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