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According to the following game tree, and if the entrant and incumbent both only care about their own monetary payoff, what is/are the game's Nash equilibrium? 

Entrant - stays out (2,15) 
- enters 
If the entrant enters, 
Incumbent - co operates (5,5) 
- punishes (-3,9) 

So what is the games nash equilibrium/equilibria, and what is the game's subgame perfect nash equilibrium/equlibria? 

Macroeconomics, Economics

  • Category:- Macroeconomics
  • Reference No.:- M9484036

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