The following table shows two firms in a duopoly.Each firm makes its decision without knowledge of the other firm's decision.The payoffs for each firm represent economic profits,and each firm strictly prefers more economic profit than less.In this game,selling ________ subscriptions a month is a dominant strategy for Flixbuster and selling ________ subscriptions a month is a dominant strategy for Nextflix.

Question

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Both firms have a dominant strategy of selling 400 subscriptions a month. Regardless of what the other firm does, they will earn the highest economic profit by selling 400 subscriptions. This is because if the other firm sells 200 subscriptions, then selling 400 subscriptions will result in a higher economic profit than selling 200 subscriptions. If the other firm also sells 400 subscriptions, then both firms will earn the same profit as they would if they both sold 200 subscriptions, but neither firm wants to risk earning less profit by selling only 200 subscriptions. Therefore, the best choice for both firms is to sell 400 subscriptions a month.

The Following Table Shows Two Firms in a Duopoly