1. Sun Resorts
Sun Resorts has a hotel on a Caribbean Island. It recently spent money to lobby the government to build a better airport and expand air service. Why did they do this? Do you think that Sun Resorts cares about how many airlines will serve the island? Explain.
2. The following game matrix shows the strategies and payoffs for Billy Corrigan and Eddie Vedder as they consider their concert schedule for Memorial Day. Each performer is headlining a national summer tour. The payoffs are in thousands of dollars.
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Eddie Vedder's Strategy
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Concert at Target Center
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Concert in Chicago
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Billy Corrigan's Strategy
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Concert at Xcel Center
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Billy gets $10
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Billy gets $22
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Eddie gets $19
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Eddie gets $18
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Concert in Chicago
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Billy gets $28
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Billy gets $10
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Eddie gets $34
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Eddie gets $20
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a. What is the dominant strategy, if any, for Billy Corrigan?
b. What is the dominant strategy, if any, for Eddie Vedder?
c. If there is a Nash equilibrium in the game, describe the Nash equilibrium or Nash equilibria.