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In Promaine Flats, Nevada there were two restaurants: Sal Monella and Road Kill Café. Current profit is $7,000 each. Cleaning will attract more customers, but profit will reduce to $5,000 each. However, if one cleans up and other doesn’t then profit will be $12,000 and $3,000.  A. Complete Payoff Matrix(picture) B. What is each players dominant strategy.(explain) C. What is the outcome of the game.(explain)

In Promaine Flats, Nevada there were two restaurants: Sal Monella and Road Kill Café. Current profit is $7,000 each. Cleaning will attract more customers, but profit will reduce to $5,000 each. However, if one cleans up and other doesn’t then profit will be $12,000 and $3,000.  A. Complete Payoff Matrix(picture) B. What is each players dominant strategy.(explain) C. What is the outcome of the game.(explain)

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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In Promaine Flats, Nevada there were two restaurants: Sal Monella and Road Kill Café. Current profit
is $7,000 each. Cleaning will attract more customers, but profit will reduce to $5,000 each. However,
if one cleans up and other doesn’t then profit will be $12,000 and $3,000. 

A. Complete Payoff Matrix(picture)

B. What is each players dominant strategy.(explain)

C. What is the outcome of the game.(explain)

Clean up Road Kill Café (RK) Doesn't clean up RK= RK= Sal Monella (SM) Clean up SM= SM= Doesn't clean up SM= RK= RK= SM=
Transcribed Image Text:Clean up Road Kill Café (RK) Doesn't clean up RK= RK= Sal Monella (SM) Clean up SM= SM= Doesn't clean up SM= RK= RK= SM=
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