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Mintguy and WLM (We Love Mint) Mintguy and WLM (We Love Mint) are the only two producers of mintavoured milk. Currently, there are 1000 customers,
Mintguy and WLM (We Love Mint) Mintguy and WLM (We Love Mint) are the only two producers of mintavoured milk. Currently, there are 1000 customers, and the two rms are splitting the market equally. Each rm makes a prot of 10 per customer. Each rm is thinking of launching an advertising campaign. at a (individual) cost of c. If one rm advertises, two things will happen: i) 500 new customers will start consuming mintavoured milk and ii) the rm that advertises will get 60% of the {total} market; the other rm will get 40%. If both rms advertise, then i) 600 new customers will start consuming mintavoured milk and ii) the rms will continue to split the market equally. Analyze this situation as a oneshot. simultaneous move game. For yourself, write down the game matrix for this game. 8 1 point Assume for the moment that c = 500. If both firms advertise, what is Mintguy's payoff? Type your answer.. 9 1 point Assume for the moment that c = 500. If only Mintguy advertises, what is Mintguy's payoff? Type your answer... 10 1 point Assume for the moment that c = 500. What is Mintguy's payoff if only WLM advertises? Type your answer...1 point Q Stop assuming that c = 500. For which of the following values of c will both rms advertise? (Choose one or more) C] i. There are no values of c for which both will advertise in a Nash equilibrium. ii. 0
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