Consider another version of the advertising game between Mountain Dew and Mello Yello.Again,each brand is deciding whether to launch an advertising campaign.These decisions will be taken simultaneously,the brands will not be cooperating,and we will assume each brand's strategist knows her own and her opponent's payoffs in all cases.The payoff matrix is listed below.

Is there a Nash equilibrium in this advertising game?
A) Yes, Mountain Dew chooses to not advertise, Mello Yello chooses to advertise
B) Yes, both Mountain Dew and Mello Yello choose to advertise
C) Yes, both Mountain Dew and Mello Yello choose to not advertise
D) Yes, both (B and

Question

Consider another version of the advertising game between Mountain Dew and Mello Yello.Again,each brand is deciding whether to launch an advertising campaign.These decisions will be taken simultaneously,the brands will not be cooperating,and we will assume each brand's strategist knows her own and her opponent's payoffs in all cases.The payoff matrix is listed below.

Is there a Nash equilibrium in this advertising game?

Is there a Nash equilibrium in this advertising game?
A) Yes, Mountain Dew chooses to not advertise, Mello Yello chooses to advertise 
B) Yes, both Mountain Dew and Mello Yello choose to advertise 
C) Yes, both Mountain Dew and Mello Yello choose to not advertise 
D) Yes, both (B and

Quizplus · Accepted Answer

In this game, there are two Nash equilibria: 
1. Both brands choose not to advertise, resulting in both receiving a payoff of 5. This is a Nash equilibrium because neither brand can unilaterally deviate and increase their payoff. 
2. Both brands choose to advertise, resulting in both receiving a payoff of 7. This is also a Nash equilibrium because neither brand can unilaterally deviate and increase their payoff. 
Therefore, the best choice for the brands is to either both advertise or both not advertise.

Consider Another Version of the Advertising Game Between Mountain Dew