Business, 30.11.2019 06:31 brookesquibbs
Aflight route is served by american airlines (aa) and southwest airlines (sw). suppose american is the industry leader american will decide whether to raise airfares, and then southwest will decide whether to match the price increase. what is the nash equilibrium of the game?
a) the game does not have a nash equilibrium.
b) american will leave fares unchanged and southwest will leave fares unchanged
c) american will leave fares unchanged and southwest will raise fares
d) american will raise fares and then southwest will leave fares unchanged
e) american will raise fares and then southwest will raise fares.
Answers: 3
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Aflight route is served by american airlines (aa) and southwest airlines (sw). suppose american is t...
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