Question 2: Find the solution to the following advertising decision game between Code and Pepsi by using the method of s

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Question 2 Find The Solution To The Following Advertising Decision Game Between Code And Pepsi By Using The Method Of S 1 (31.54 KiB) Viewed 107 times

Question 2: Find the solution to the following advertising decision game between Code and Pepsi by using the method of successive elimination of dominated strategies. Payoffs in millions of dollars of annual profit Pepsi's Budget Low Medium High Low A $400, S400 $320, S720 S560, S600 Coke's budget Medium D $500, 5300 E $450, S525 $540, S500 High G $375, $420 HS300, $378 S525, $750 a) Does Coke have a dominated strategy in the original payoff table? If so, what is it and why is it dominated? If not, why not? b) Docs Pepsi have a dominated strategy in the original payoff table? If so, what is it and why is it dominated? If not, why not? c) After the first round of eliminating any dominated strategies that can be found in the original payoff table, describe the strategic situation facing Coke and Pepsi in the reduced payoff table. d) What is the likely outcome of this advertising decision problem? e) Pepsi's highest payoff occurs when Coke and Pepsi both choose high ad budgets. Explain why Pepsi will not likely to choose a high ad budget.