Alpha and Beta, two oligopoly rivals in a duopoly market, choose prices of their

Question

Alpha and Beta, two oligopoly rivals in a duopoly market, choose prices of their products on the first day of the month. The following payoff table shows their monthly payoffs resulting from the pricing decisions they make.

Alpha's Price

Beta's Price

*Payoffs in thousands of dollars per month

Is the pricing decision facing Alpha and Beta a Prisoner

Low Medium Low A $200, $300 $50,$350 Medium C $300, $150 D $75, $200

*Payoffs in thousands of dollars per month

Is the pricing decision facing Alpha and Beta a Prisoner

Explanation / Answer

Following Payoff Matrix for Alpha and Beta:-

Alpha's Price Low Medium Beta' Price Low $200, $300 $50,$350 Medium $300, $150 $75, $200

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