AT&T and MCI are competing in the long-distance telephone market. Both companies are...
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AT&T and MCI are competing in the longdistance telephone market. Both companies are considering whether to offer a discount calling plan to attract new customers. Their payoffs depend as follows on the combinations of strate gies chosen:
If both companies offer discount calling plans, then each company loses $ million.
If AT&T offers a discount calling plan and MCI does not, then AT&T makes a profit of $ million and MCI suffers a loss of $ million.
If MCI offers a discount calling plan and AT&T does not, then MCI makes a profit of $ million and AT&T suffers a loss of $ million.
If neither company offers a discount calling plan, each makes a profit of $ million.
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