The table given below represents the payoff matrix of firms A and B,when they choose to produce either high output or low output.In each cell,the figure on the left indicates Firm B's payoffs and the figure on the right indicates Firm A's payoffs.
-If X = 15 and Y = 10,then the information in Table 14-3 implies that the game has:
A)a Nash equilibrium and a dominant strategy equilibrium.
B)a Nash equilibrium but not a dominant-strategy equilibrium.
C)no Nash equilibrium but has a dominant-strategy equilibrium.
D)neither a Nash equilibrium nor a dominant-strategy equilibrium.

Question

The table given below represents the payoff matrix of firms A and B,when they choose to produce either high output or low output.In each cell,the figure on the left indicates Firm B's payoffs and the figure on the right indicates Firm A's payoffs. 
-If X = 15 and Y = 10,then the information in Table 14-3 implies that the game has:
A)a Nash equilibrium and a dominant strategy equilibrium. 
B)a Nash equilibrium but not a dominant-strategy equilibrium. 
C)no Nash equilibrium but has a dominant-strategy equilibrium. 
D)neither a Nash equilibrium nor a dominant-strategy equilibrium.

Quizplus · Accepted Answer

The game has a Nash equilibrium at (X = 15, Y = 10) because neither player can improve their payoff by changing their strategy given the other player's strategy. The game also has a dominant strategy equilibrium because X has a dominant strategy of playing 15 regardless of what Y plays.

The Table Given Below Represents the Payoff Matrix of Firms