In the next five questions, Marvel Comics and DC Comics each produced a comic book that can be released on January 26th or July 4th. The table below shows the profit to each firm depending upon when the books are released. Assume profits only depend on the dates of release. For instance, if Marvel acquires the distribution rights to DC's book and distributes them on January 26th (Marvel's book) and July 4th (DC's book), then the profits are still 30 and 90 for these two books, respectively, and Marvel receives both profits-whoever owns the distribution rights of a book also owns the profit from that book. Marvel January 26th July 4th DC January 26th July 4th 30,90 50,40 30, 20 20,30 1. Find the Nash Equilibrium if neither acquires rights to the other's comic book 2. Which release dates maximize the total profit earned by the firms (i.e. the sum of the two firms' profits)? 3. What is the highest price that Marvel would be willing to pay in order to acquire the distribution rights to DC's book? Please enter a whole number, with no special characters like dollar signs, no space before or after or in between, and no letters. 4. What is the lowest price that DC would accept to sell the rights to its book? Please enter a whole number, with no special characters like dollar signs, no space before or after or in between, and no letters. 5. If Marvel ends up purchasing the distribution rights to DC's book, on what dates will it release the books?

Principles of Microeconomics (MindTap Course List)
8th Edition
ISBN:9781305971493
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter17: Oligopoly
Section: Chapter Questions
Problem 9PA
Question

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In the next five questions, Marvel Comics and DC Comics each produced
a comic book that can be released on January 26th or July 4th. The table
below shows the profit to each firm depending upon when the books are
released. Assume profits only depend on the dates of release. For instance,
if Marvel acquires the distribution rights to DC's book and distributes them
on January 26th (Marvel's book) and July 4th (DC's book), then the profits
are still 30 and 90 for these two books, respectively, and Marvel receives
both profits-whoever owns the distribution rights of a book also owns
the profit from that book.
Marvel January 26th
July 4th
DC
January 26th July 4th
30,90
50,40
30, 20
20,30
1. Find the Nash Equilibrium if neither acquires rights to the other's
comic book
2. Which release dates maximize the total profit earned by the
firms (i.e. the sum of the two firms' profits)?
3. What is the highest price that Marvel would be willing to pay in order
to acquire the distribution rights to DC's book? Please enter a whole
number, with no special characters like dollar signs, no space before
or after or in between, and no letters.
4. What is the lowest price that DC would accept to sell the rights to its
book? Please enter a whole number, with no special characters like
dollar signs, no space before or after or in between, and no letters.
5. If Marvel ends up purchasing the distribution rights to DC's book, on
what dates will it release the books?
Transcribed Image Text:In the next five questions, Marvel Comics and DC Comics each produced a comic book that can be released on January 26th or July 4th. The table below shows the profit to each firm depending upon when the books are released. Assume profits only depend on the dates of release. For instance, if Marvel acquires the distribution rights to DC's book and distributes them on January 26th (Marvel's book) and July 4th (DC's book), then the profits are still 30 and 90 for these two books, respectively, and Marvel receives both profits-whoever owns the distribution rights of a book also owns the profit from that book. Marvel January 26th July 4th DC January 26th July 4th 30,90 50,40 30, 20 20,30 1. Find the Nash Equilibrium if neither acquires rights to the other's comic book 2. Which release dates maximize the total profit earned by the firms (i.e. the sum of the two firms' profits)? 3. What is the highest price that Marvel would be willing to pay in order to acquire the distribution rights to DC's book? Please enter a whole number, with no special characters like dollar signs, no space before or after or in between, and no letters. 4. What is the lowest price that DC would accept to sell the rights to its book? Please enter a whole number, with no special characters like dollar signs, no space before or after or in between, and no letters. 5. If Marvel ends up purchasing the distribution rights to DC's book, on what dates will it release the books?
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