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Suppose there are only two TV stations in Arecima, each broadcasting programming over the airwaves. Each station wishes to get the maximum number of viewers

Suppose there are only two TV stations in Arecima, each broadcasting programming over the airwaves. Each station wishes to get the maximum number of viewers and each is considering whether to carry a reality-tv show or a comedy show in its 11pm slot on Saturdays. The 1000 Arecima residents have the following preferences: 800 of them wish to watch a reality-tv show and have no interest in a comedy show whereas 200 people would enjoy watching a comedy on TV but would go sleep if both stations chose to broadcast a reality tv show. Each station will receive half the audience if both broadcast the same type of show. Write down the `outcome matrix' of this game and find the Nash equilibrium. Is the equilibrium efficient? As usual, justify your answers.

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