Use the following scenario for questions 8-9

Alvin C. Monk and Barnaby Jones are both ice-cream vendors.They have only just recently met each other, and both are strong competitors always looking for an advantage over the other guy.

Currently, Alvin and Barnaby are engaged in a simultaneous pricing game.Listed below are the four (4) possible outcomes of this game:

If only one of them prices low, he gets the vast majority of the customers, a payoff of $1000, while the one who doesn't price low gets $0.

If they both price high, they each get a payoff of $600.

If they both price low, they each get a payoff of $500.

8.What is the Nash equilibrium of this game?

a.

Both vendors price high

b.

Both vendors price low

c.

Alvin prices high, Barnaby prices low

d.

Barnaby prices high, Alvin prices low