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    Game Theory: Coke vs Pepsi

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    Use game theory analysis to describe the competitive behavior of Coke and Pepsi making specific references to actions taken by each firm. What conclusions can you draw about this type of competitive strategy?

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    Game theory is used to model the behaviour of oligopolies. Unlike monopolies, oligopolies have market competitors, but unlike perfectly competitive firms and monopolistically competitive firms, oligopolistic firms have so few competitors that pricing and marketing decisions made by one firm can affect all the other firms. This means that firms must take ...

    Solution Summary

    This solution uses game theory to illustrate the competition between Coke and Pepsi, making specific references to actions taken by each firm.