8. Collusive outcome versus Nash equilibriumSuppose there is a remote stretch of highway along which two restaurants, Last Chance Café and Desolate Diner, operate in a duopoly. Neitherrestaurant invests in keeping up with health code regulations, but regardless they both have customers as they are the only dining options along a 79-mile portion of the road. Both restaurants know that if they clean up and comply with health codes they will attract more customers, but this alsomeans that they will have to pay workers to do the cleaning.If neither restaurant cleans, each will earn $11,000; alternatively, if they both hire workers to clean, each will earn only $8,000. However, if one cleansand the other doesn't, more customers will choose the cleaner restaurant; the cleaner restaurant will make $15,000, and the other restaurant willmake only $3,000.Complete the following payoff matrix using the information just given. (Note: Last Chance Café and Desolate Diner are both profit-maximizing firms.)Last Chance CateCleans UpDoesnt Clean UpCleans UpDesolate Diner11Doesn't Clean UpLast Chance Cafe and Despiate Diner decide to collude, the outcome of this game is as follows: Last Chance Cafeand Desolateboth restaurants deode to cheat and behave noncooperatively, the outcome reflecting the unique Nash equilibrium of this game is as follows: LastChance Cale57°F Mostly clow Complete the following payoff matrix using the information just given. (Note: Last Chance Cafe and Desolate Diner are both profit-maximizing firms.)archLast Chance CateCleans UpDoesn't Clean UpCleans UpEDesolate Diner1 Last Chance Café and Desolate Diner decide to collude, the outcome of the game is as follows: Last Chance CaféDinerASDoesn't Clean UpcleansIf both restaurants decide to cheat and behave noncooperatively, the outcome reflecting the unique Nash equilibour does not clean as follows: LastChance Caleand Desolate Diner6and DesolateGrade It NowSave & ContinueContinue without saving57°F Mostly clou

The answer provided below has been developed in a clear step by step manner.Step: 1Alright buddy let…

8. Collusive outcome versus Nash equilibrium Suppose there is a remote stretch of highway along which two restaurants, Last Chance Café and Desolate Diner, operate in a duopoly. Neither restaurant invests in keeping up with health code regulations, but regardless they both have customers as they are the only dining options along a 79- mile portion of the road. Both restaurants know that if they clean up and comply with health codes they will attract more customers, but this also means ans that they will have to pay workers to do the cleaning. If neither restaurant cleans, each will earn $11,000; alternatively, if they both hire workers to clean, each will earn only $5,000. However, if one cleans and the other doesn't, more customers will choose the cleaner restaurant; the cleaner restaurant will make $15,000, and the other restaurant will make only $3,000. Complete the following payoff matrix using the information just given. (Note: Last Chance Café and Desolate Diner are both profit-maximizing firms.) Desolate Diner Cleans Up Doesnt Clean Up Cleans Up Doesnt Clean Up

8. Collusive outcome versus Nash equilibrium Suppose there is a remote stretch of highway along which two restaurants, Last Chance Café and Desolate Diner, operate in a duopoly. Neither restaurant invests in keeping up with health code regulations, but regardless they both have customers as they are the only dining options along a 79- mile portion of the road. Both restaurants know that if they clean up and comply with health codes they will attract more customers, but this also means ans that they will have to pay workers to do the cleaning. If neither restaurant cleans, each will earn $11,000; alternatively, if they both hire workers to clean, each will earn only $5,000. However, if one cleans and the other doesn't, more customers will choose the cleaner restaurant; the cleaner restaurant will make $15,000, and the other restaurant will make only $3,000. Complete the following payoff matrix using the information just given. (Note: Last Chance Café and Desolate Diner are both profit-maximizing firms.) Desolate Diner Cleans Up Doesnt Clean Up Cleans Up Doesnt Clean Up

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The dropdown options are "Cleans" or "Does not clean." thank you!
For the game in FIGURE 7.6, derive players’ best-reply functions, plot them as shown in Figure 7.5, and find the Nash equilibrium.
9. For the payoff matrix below, consider a sequential version of the game in which Player 2 moves first and then Player 1 moves second. Which of the following is not a correct statement? Player 1 Top Center Bottom Left 1,2 5,1 6,0 Player 2 Middle 7,1 11,2 -4,3 Right 10,4 1,0 8,5 The subgame perfect payoffs coincide with those of a Nash equilibrium b. Depending on Player 2's move, Player 1 will sometimes optimally choose Bottom c. Player 2 will choose Right in the subgame perfect equilibrium d. Player 2 would be willing to pay a positive $ amount to move first rather than second e. Player 1 would be willing to pay a larger $ amount than Player 2 to move first
help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working
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The options for the last 3 fill-in-the-blanks are "Up" or "Down." Thank you!
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
7. Solving for dominant strategies and the Nash equilibrium Suppose Gabriel and Nia are playing a game that requires both to simultaneously choose an action: Up or Down. The payoff matrix that follows shows the earnings of each person as a function of both of their choices. For example, the upper-right cell shows that if Gabriel chooses Up and Nia chooses Down, Gabriel will receive a payoff of 6 and Nia will receive a payoff of 4. Gabriel Up Down Up 6,3 3,3 Nia Down 6, 4 7,4 In this game, the only dominant strategy is for to choose The outcome reflecting the unique Nash equilibrium in this game is as follows: Gabriel chooses and Nia chooses