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Three firms are considering whether to enter a new market. A firm that does not enter gets a payoff of 0. A firm that does
Three firms are considering whether to enter a new market. A firm that does not enter gets a payoff of 0. A firm that does choose to enter must pay a cost of 62 and makes revenues of 150/n , where n is the total number of firms that choose to enter; its payoff is the amount of profits it makes.
(a) Find the set of pure strategy Nash equilibria.
(b) Find the symmetric mixed strategy Nash equilibrium, where all three firms enter with the same probability.
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