Question
Firms 1 and 2 simultaneously and independently select to adopt either technology A or B. Technology A is regarded as superior by both firms, yielding
Firms 1 and 2 simultaneously and independently select to adopt either technology A or B. Technology A is regarded as superior by both firms, yielding a payoff of 2 to each firm if they both adopt it, while the adoption of technology B by both firms only entails a payoff of 1 for each. If they do not adopt the same technology, both obtain a payoff of 0 (because consumers will not want to have to convert files between the two technologies).
a. Is this a symmetric game?
b. Find all the Nash equilibria.
c. What are the maximin and minimax strategies for the two firms? What are their maximin and minimax values?
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