Suppose that Mozilla and Microsoft each develop their own versions of an amazing new Web browser that allows advertisers to target consumers with great precision. Also, the new browser is easier and more fun to use than existing browsers. Each firm is trying to decide whether to sell the browser or to give it away The payoff matrix shows each firm’s economic profit in millions of dollars. Microsoft’s strategies (red squares) $300 $200 Fill in the four blank headings in the matrix to indicate whether each payoff is associated with charging for the browser or giving it away for free Choose the correct statement. $300 $900 Firefox’s strategies (blue squareS) 0 A. The equilibrium of this game is that one firm gives the browser away for Charge free and the other sells it. $900 $500 Free O B. The equilibrium of this game is that both firms give the browser away for free ° C. The equilibrium of this game is that both firms sell the browser ( D. This game has no equilibrium. $200 $500

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