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The payoff matrix below shows the payoffs (in millions of dollars) for two firms, A and B, for two different strategies, investing in new capital
The payoff matrix below shows the payoffs (in millions of dollars) for two firms, A and B, for two different strategies, investing in new capital or not investing in new capital. An industry spy comes to firm B and offers to pay B in exchange for B's certain and enforceable promise to not invest. How much must the spy pay B?
Select one:
a. $0
b. At least $15 million.
c. At least $35 million.
d. At least $50 million.
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Firm B Invest Not invest 20 for A 70 for A Invest 20 for B 5 for B Firm A 50 for A 5 for A 70 for B Not invest 50 for BStep by Step Solution
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