Taylormade and Titlelist are considering a production strategy for their new golf drivers. If they each produce a small output, they can price the product higher and make more profit than if they each produce a large output. Their payoff/profit matrix is given below.
(a) Does either player have a dominant strategy here?
(b) What is the Nash equilibrium to the game?
(c) Do you think that a cartel arrangement would be sustainable?