Table 14-5

Ming and Henri each run one of the two dry cleaning facilities in the town of Scaraby.Both consider offering free pickup and delivery services.Table 14-5 shows the payoff matrix containing the expected quarterly profits for each firm.
-Refer to Table 14-5.What is the Nash equilibrium in this game?

Question

Table 14-5
  
Ming and Henri each run one of the two dry cleaning facilities in the town of Scaraby.Both consider offering free pickup and delivery services.Table 14-5 shows the payoff matrix containing the expected quarterly profits for each firm.
-Refer to Table 14-5.What is the Nash equilibrium in this game?

Quizplus · Accepted Answer

The Nash equilibrium is achieved when both players choose to offer free pickup and delivery. In this scenario, both players gain a higher profit of $60,000 rather than $50,000 when only one player offers the service. Therefore, it is in the best interest of both players to adopt this strategy.

Table 14-5 Ming and Henri Each Run One of the Two Dry