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Price = $20 Target Price = $13 $8,000 $1,500 Price $20 = $8,000 $13,000 Wal-Mart Consider a market with two firms, Target and Wal-Mart,
Price = $20 Target Price = $13 $8,000 $1,500 Price $20 = $8,000 $13,000 Wal-Mart Consider a market with two firms, Target and Wal-Mart, that sell CDs in their music department. Both stores must choose whether to charge a high price ($20) or a low price ($13) for the new Miley Cyrus CD. These price strategies with corresponding profits are depicted in the payoff matrix. Target's profits are in red and Wal-Mart's are in blue. Target's dominant strategy is to pick a price of $ Wal-Mart's dominant strategy is to pick a price of $ . What is the Nash equilibrium for this game? OA. The Nash equilibrium is for Target to choose a price of $20 and Wal-Mart to choose a price of $13. B. A Nash equilibrium does not exist for this game. OC. The Nash equilibrium is for Target and Wal-Mart to both choose a price of $13. OD. The Nash equilibrium is for Target and Wal-Mart to both choose a price of $20. OE. The Nash equilibrium is for Target to choose a price of $13 and Wal-Mart to choose a price of $20. Price $13 $13,000 $3,000 $1,500 $3,000
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