Consider the department store market in Sydney. Two players, David Jones and MYER, are deciding the prices for their new seasonal collection. They could choose either high or low pricing strategy. The payoffs are given by the following table. The first payoff is for David Jones. MYER David Jones Low High Low 6,6 7,4 High 4,8 8,9 5. If David Jones and MYER decide simultaneously, which of

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Consider the department store market in Sydney. Two players, David Jones and MYER, are deciding the prices for their new seasonal collection. They could choose either high or low pricing strategy. The payoffs are given by the following table. The first payoff is for David Jones. MYER David Jones Low High Low 6,6 7,4 High 4,8 8,9 5. If David Jones and MYER decide simultaneously, which of the following is true? a) There are two Nash equilibria in this game. b) There is no Nash equilibrium. c) Both shops have a dominant strategy to high pricing strategy. d) There is a unique Nash equilibrium. e) None of the other answers is correct.
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