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Business, 31.05.2021 21:30 mariss8152

Consider the following payoff matrix for a game in which two firms attempt to collude under the Bertrand model: Firm B cuts Firm B colludes
Firm A cuts 6,6 24,8
Firm A colludes 8,24 12,12

Here, the possible options are to retain the collusive price​(collude) or to lower the price in attempt to increase the​ firm's market share​ (cut). The payoffs are stated in terms of millions of dollars of profits earned per year. What is the Nash equilibrium for this​ game?

a. Both firms cut prices.
b. Both firms collude.
c. B cuts and A colludes.
d. A cuts and B colludes.

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