Dell and Gateway are close competitors in the personal computer market.Suppose that each year Dell and Gateway have to decide whether to spend money on costly research and development (R&D).If both spend money on R&D, each firm will earn $30 million.If neither spends money on R&D, each firm will earn $40 million.If one firm spends money on R&D and the other does not, the firm that engaged in R&D would earn $45 million and the firm that did not would earn $25 million.a) Use a payoff matrix to depict this problem.b) What is the noncooperative solution to this game?
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