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wo banks compete for the checking andsavings deposit business of a small town.Each bank has its own ATM network thatworks only on its own bankcards,
wo banks compete for the checking andsavings deposit business of a small town.Each bank has its own ATM network thatworks only on its own bankcards, but bank1 has three times as many ATM machines asbank 2. Depositors value a bank's servicesas an increasing function of the number ofmachines on the network. Bank 2 approachesbank 1 and suggests that they merge theirATM networks so that depositors of eitherbank can use either bank's machines.a. Is this merger in the interest of depositconsumers in general?b. Do you think that bank 1 will agree withbank 2's proposal
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