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Surviving might-see TV. (Grant) [This question illustrates t

Paper help Economics Surviving might-see TV. (Grant) [This question illustrates t

Economics

Surviving might-see TV. (Grant) [This question illustrates t

Surviving might-see TV. (Grant) [This question illustrates the di erence between si- multaneous a… Show more Surviving might-see TV. (Grant) [This question illustrates the di erence between si- multaneous and sequential settings.] There are three major-network-aliate television stations in Hicksville: RBC, CBC and MBC. All three stations have the option of airing the evening network-news program live at 6:00pm or in a delayed broadcast at 7:00pm. By regulation, they may not choose other times. Each station’s objective is to maximize its viewing audience to maximize the station’s advertising revenue. The tables below (the result of extensive research) give the percentage of Hicksville’s total population `captured’ by each station as a function of the times at which each news program is shown. The numbers do not sum to 100 since not everyone always watches TV.(see picture) Please Answer: (a) Suppose that the choices of all three stations are made simultaneously. Find any Nash equilibria. [Hint: try to set this up so it looks more like a normal-form game. To do this for three players use two 2 2 matrices: let MBC choose the matrix, RBC the row and CBC the column.]. (b) Suppose now that the game is played sequentially. MBC moves rst. RBC moves second and CBC moves third. Each station can observe all previous moves before making her choice. Explain what you think will happen. (c) Look at your answers to parts (a) and (b). Give a game-theory intuition why there is, or is not, a di erence in the outcome. • Show less

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