Use the following matrix to answer the following questions.

Assume that this is a simultaneous move one shot game.

(a)Determine the dominant strategy for player A and Player B. If such a strategy does not

exist, explain why not.

(b)Determine the secure strategy for player A and player B. If such a strategy does not exist,

explain why not.

(c)Determine if a Nash equilibrium exists in this game and explain why it exists (or why

not).

At a time when cereal maker Kellogg's demand for ready-to-eat cereal was stagnant, a spokesperson for the cereal maker Kellogg's was quoted as saying, ".....for the pastseveral years, our individual company growth has come out of the other fellow's hide." Kellogg's has been producing cereal since 1906 and continues to implement strategies that make it a leader in the cereal industry. The payoff matrix for Kellogg and its rival to advertise or "don't advertise" is given below

Kellogg's Rival

Advertise

Don't Advertise

Advertise

(0, 0)

(52, ?4)

Kellogg

Don't Advertise

(?4, 52)

(12, 12)

(a) If this were a simultaneous move one shot game, what would the Nash equilibrium outcome be? Please explain.

(b) Assuming that the game is still played once, if the firms could collude, what would the collusive outcome be, assuming that they made a collusive agreement and followed the agreement. Please explain.

(c)Now suppose the game is infinitely repeated. If the interest rate is 35 percent, can you do better in the infinitely repeated game with a trigger strategy than you could in a one-shot play of the game? Explain.

0' word Home File Edit View Insert Insert Draw Design ' limes New; v i 12 Format Tools Table Window Help wk L:J E \"3 G} Sun 1:01 AM Yeminjal Blue Q 6 55 Layout References Mailings Review IEShare OCommems v A' AV E , Anybcwm AmchDdl AthCchE Ambcmar AaBchDdEs AaBb( > A L!) V l m. Emphasis Heading 1 Strong Subtltle Tllle Styles Dictate Pane 1%1'42131451'Sd7l Homework 8 Total Points = 25 1. (5 points) Can the game theory approach described in chapter 10 he used to analyze the model of Perfect Competition? Please explain. 2. (5 points) Use the following payoff matrix for a simultaneous move one shot game to answer the followingguestions Player 2 Strategy 0 D E F Player 1 A L14 L 11 L20 L19 B 12. 5 15. 1 1. 25 1.6. 17 (a) Does player 1 have a dominant strategy? If yes, what is it? If no, why not? (b) Does player 2 have a dominant strategy? If yes, what is it? If :10, why not? (c) Does this game have aNash equilibrium? Please explain. 3. (5 points) Use the following matrix to answer the followingguestions. Player 2 Strategy C D Player 1 A -L -10 k -100 B -]_(m. 220 1.40. 180 Assume that this is a simultaneous move one shot gamel (a) Determine the dominant strategy for player A and Player B. If such a strategy does not exist, explain why not. (b) Determine the secure strategy for player A and player B. If such a strategy does not exist, explain why not. (0) Determine if a Nash equilibrium exists in this game and explain why it exists (or why not). Word File Edit View Insert Format Tools Table Window Help Sun 1:02 AM Yeminjal Blue QE August 1, 2020 at 8:02:11 PM 10. . w= homework8 H Home Insert Draw Design Layout References Mailings Review View Tell me Share Comments Times New... v 12 A A Aa Ap AaBbCcDdEe AaBbCcDdl AaBbCcDdE AaBbCcDdl AaBbCcDdE AaBb( Paste BI Uvab X2 X A LA Emphasis Heading 1 Normal Strong Subtitle Title Styles Dictate Pane 4. (10 points) At a time when cereal maker Kellogg's demand for ready-to-eat cereal was stagnant, a spokesperson for the cereal maker Kellogg's was quoted as saying, ".....for the past several years, our individual company growth has come out of the other fellow's hide." Kellogg's has been producing cereal since 1906 and continues to implement strategies that make it a leader in the cereal industry. The payoff matrix for Kellogg and its rival to advertise or "don't advertise"[+ given below Kellogg's Rival Advertise Don't Advertise Advertise (0, 0) (52, -4) Kellogg Don't (-4, 52) (12, 12) Advertise (a) If this were a simultaneous move one shot game, what would the Nash equilibrium outcome be? Please explain. (b) Assuming that the game is still played once, if the firms could collude, what would the collusive outcome be, assuming that they made a collusive agreement and followed the agreement. Please explain. (c) Now suppose the game is infinitely repeated. If the interest rate is 35 percent, can you do better in the infinitely repeated game with a trigger strategy than you could in a one-shot play of the game? Explain. Page 2 of 2 419 words X English (United States) Focus E - + 130% AUG 2 4 W DOCY