Suppose two companies, Macrosoft and Apricot, are considering whether to develop a new product, a touch-screen t-shirt. The payoffs to each of developing a touch-screen t-shirt depend upon the actions of the other, as shown in the payoff matrix below (the payoffs are given in millions of dollars) . 
Suppose Apricot makes its decision first, and then Macrosoft makes its decision after seeing Apricot's choice. What will be the equilibrium outcome of this game?
Definitions:
Exchange Loss
A loss resulting from holding foreign currencies that depreciate against the home currency.
Forward Contract
An agreement to purchase or sell an asset at a predetermined future date and price, often used as a hedging instrument against price fluctuations.
Recognition
The process in accounting where certain transactions are recorded in the financial statements of a reporting period.
Discount
A reduction applied to the nominal price or face value of something for promotional purposes, or to reflect current market values.
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