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QUESTION

Irene's Dairy is deciding whether or not to enter the market for ice cream, currently monopolized by Mattie's Ice-cream.

Irene's Dairy is deciding whether or not to enter the market for ice cream, currently monopolized by Mattie's Ice-cream. If it enters the market, Mattie's can either accommodate him and share his 10million in profits equally with Irene or fight him and cause a 5million loss for each in a price war.​

​ In a sequential game, if Irene decides to enter the market, what would be Mattie's best response?

a.

b.

c.

d.

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