Question
Matt and Lin are both math tutors. They know that if they collude and set a high price, both will earn a profit of 100;
Matt and Lin are both math tutors. They know that if they collude and set a high price, both will earn a profit of 100; whereas if they both set a low price, both will earn a profit of 50. If one person sets a high price and the other person sets a low price, the person who sets a low price gets a profit of 125 and the one with a high price gets a profit of 0. Fill in the payoffs in the normal-form game below where Lin is player 1 (represented by rows) and Matt is player 2 (represented by columns).
Matt | |||
---|---|---|---|
High | Low | ||
Lin | High | _________,_________ | ______,________ |
Low | ________,________ | ________,________ |
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