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Megabucks and CashCow are the only two firms in a market. Each firm must decide whether to price high or price low. The payoffs from
Megabucks and CashCow are the only two firms in a market. Each firm must decide whether to price high or price low. The payoffs from each strategy combination are shown to the right - in millions of dollars. The first number in Price High ----- Cash Cow ----- Price Low each pair is Megabucks' profit; the second is CashCow's profit. If the firms cooperate, the strategy that Megabucks will choose is $90 $135 and the strategy that CashCow will choose is If the firms behave opportunistically, the strategy that Megabucks will choose is . . . and the strategy that CashCow will choose is $90 $5 Price Low ---Megabucks --- Price High $5 $18 $135 $18Megabucks and CashCow are the only two firms in a market. Each firm must decide whether to price high or price low. The payoffs from each strategy combination are shown to the right - in millions of dollars. The first number in each pair is Megabucks' profit; the second is CashCow's profit. If the firms cooperate, the strategy that Megabucks will choose is and the strategy that CashCow will choose is If the firms behave opportunistically, the strategy that Megabucks \\ and the strategy that CashCow will choose is price high price low
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