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Two large firms, one domestic and one foreign, are competing in the world market for aluminum. If either obtains a subsidy from its respective national
Two large firms, one domestic and one foreign, are competing in the world market for aluminum. If either obtains a subsidy from its respective national government, it can shift profits away from its competitor and increase national income. The firms have the following payoff matrix. Does either firm have a dominant strategy? What is the Nash equilibrium?
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