Asus

-Dell and Asus must decide whether to lower their prices, based on the potential economic profits shown in the payoff matrix above (in millions of dollars). In the Nash equilibrium, Dell's profit is _______ million and Asus's profit is _______ million.
A) $15; $15
B) $10; $10
C) $5; $20
D) $20; $5

Question

Asus
 
-Dell and Asus must decide whether to lower their prices, based on the potential economic profits shown in the payoff matrix above (in millions of dollars). In the Nash equilibrium, Dell's profit is _______ million and Asus's profit is _______ million.
A) $15; $15 
B) $10; $10 
C) $5; $20 
D) $20; $5

Quizplus · Accepted Answer

In the Nash equilibrium, both firms choose strategies where neither has an incentive to deviate. If both Dell and Asus lower their prices, they each earn $10 million, which is the Nash equilibrium.

Asus -Dell and Asus Must Decide Whether to Lower Their Prices