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Firm 1 -Two Software Firms Have Developed an Identical New Software Application

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Firm 1 Firm 1   -Two software firms have developed an identical new software application. They are debating whether to give the new application away free and then sell add-ons or sell the application at $30 a copy. The payoff matrix is above and the payoffs are profits in millions of dollars. What is the Nash equilibrium of the game? A)  Both Firm 1 and 2 will sell the software application at $30 a copy. B)  Both Firm 1 and 2 will give the software application away free. C)  Firm 1 will give the application away free and Firm 2 will sell it at $30. D)  There is no Nash equilibrium to this game.
-Two software firms have developed an identical new software application. They are debating whether to give the new application away free and then sell add-ons or sell the application at $30 a copy. The payoff matrix is above and the payoffs are profits in millions of dollars. What is the Nash equilibrium of the game?


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