It is illegal for any two firms that sell similar products to engage in price fixing agreements. Violating the anti-trus

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It is illegal for any two firms that sell similar products toengage in price fixing agreements. Violating the anti-trust lawscan bring both civil and criminal prosecutions. Nevertheless, pricefixing does take place. Examples would be found at the serviceplazas along the NY State Thruway and the NJ Turnpike. Eachlocation has a small number of fast food restaurants. Each fastfood restaurant belongs to a different firm, which should createcompetition, yet at service plazas all have uncommonly high prices.Draw a prisoner’s dilemma type of game (2x2) to show the pricingchoices and strategies of two competing fast food restaurants,located at one service plaza. Payoffs are daily profits. Createsensible numbers. Write a brief explanation for the differentnumbers that you have created. Identify John Nash’s equilibrium, aswell as the optimal outcome for the two fast food outlets. Alsofind and label any strictly dominant strategies. Actual long runpricing results at the service plaza may be contrary to the resultspredicted by the 2x2 diagram from part A. Explain why actualresults may differ in the long run. Why is competition betweendifferent firms unable to bring lower prices to the consumer at theservice plaza?