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Question 5 (15 points). Two firms are players in a one-shot, simultaneous-move game. The first number in each cell of the following profit payoff matrix

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Question 5 (15 points). Two firms are players in a one-shot, simultaneous-move game. The first number in each cell of the following profit payoff matrix is Firm A's profit payoff; the second number is the profit payoff to Firm B. Each firm needs to choose a strategy: either "Advertising" or "R&D". Firm B Strategy Advertising R&D Firm A Advertising $10 million, $20 million $16 million, $12 million R&D $10 million, $8 million $10 million, $10 million I (1). Is there a dominant strategy for Firm A and Firm B? If so, what is it? (5 points) (2). Is there a pure strategy Nash equilibrium? If so, what is it? (5 points) (3). Is there a secure strategy for Firm A and Firm B? If so, what is it? (5 points) 2

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