The following matrix shows the payoffs for an advertising game between Coke and Pepsi. The firms can choose to advertise or to not advertise. Numbers in the matrix represent profits; the first number in each cell is the payoff to Coke. (Numbers in millions.)
Coke (rows)/Pepsi (columns) Advertise Don't Advertise
Advertise (10, 10) (500, -50)
Don't Advertise (-50, 500) (100, 100)
Explain why this would be described as a Prisoner's Dilemma game.
Explain the probable outcome of this game.© BrainMass Inc. brainmass.com March 21, 2019, 4:52 pm ad1c9bdddf
This solution discusses why this game fits the zero-sum framework of the prisoner's dilemma and demonstrates the probable outcome of the game.