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Question: consider the finite 2 player game representing price competition in...

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Consider the finite 2 player game, representing price competition in a market where al costumers buy from the seller with the lowest price. Both sellers simultaneously choose price, p1 and p2, where pi is in P = {0,1,2,3,4}. The profits to each seller are given in the payoff bi-matrix below, where seller 1 chooses row and seller 2 column.

Firm 2

p=0 p=1 p=2 p=3 p=4
p=0 -5,-5 -10,0 -10,0 -10,0 -10,0
p=1 0,-10 0,0 0,0 0,0 0,0
p=2 0,-10 0,0 3,3 6,0 6,0
p=3 0,-10 0,0 0,6 4,4 8,0
p=4 0,-10 0,0 0,6 0,8 3,3

Firm 1

a.) Find and describe all strictly dominated pure strategies for Firm 1

b.) Find and describe all weakly dominated pure strategies for Firm 1

c.) Find and describe all pure strategy Nash equilibria

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