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GAME THEORY Problem2 (A): Firm E (the entrant) can choose whether to enter a market against a single incumbent, Firm I, or exit. If Firm

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GAME THEORY

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Problem2 (A): Firm E (the entrant) can choose whether to enter a market against a single incumbent, Firm I, or exit. If Firm E enters, Firm I can either respond by fighting or accommodating. Solve with backward induction. Firm E Out In Firm I Fight Accommodate

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