Collusive outcome versus Nash equilibrium Consider a remote town in which two restaurants, All-You-Can-Eat Cafe and GoodGrub Diner, operate in a duopoly

Collusive outcome versus Nash equilibrium Consider a remote town in which two restaurants, All-You-Can-Eat Cafe and GoodGrub Diner, operate in a duopoly. Both restaurants disregard health and safety regulations, but they continue to have customers because they are the only restaurants within 80 kilometres of town. Both restaurants know that if they clean up, they will attract more customers, but this also means that they will have to pay workers to do the cleaning. If neither restaurant deans, each will eam $11,000; alternatively, if they both hire workers to dean, each will earn only $8,000. However, if one cleans and the other doesn't more customers will choose the cleaner restaurantthe cleaner restaurant will make $16,000, and the other restaurant will make only $4,000 Complete the following payoff matrix/table using the previous information. (Note: Al-You-Can-Eat Care and GoodGrub Diner are both profle- maximizing firms.) GoodGrub Diner Cleans Up Doesn't Clean Up Clean Up $ S All You Can Eat Cafe Don't Clean Up s and Ir All You Can Eat Cafe and GoodGrub Diner decide to collude, the outcome of this game is as follows: All You Can-Eat Café GoodGrub Diner If both restaurants decide to cheat and behave noncooperatively, the outcome reflecting the unique Nash equilibrium of this game is as follows: All
If All-You-Can-Eat Café and GoodGrub Diner decide to collude, the outcome of this game is as follows: All-You-Can-Eat Café GoodGrub Diner and If both restaurants decide to cheat and behave noncooperatively, the outcome reflecting the unique Nash equilibrium of this game is as follows: All- You-Can-Eat Café and GoodGrub Diner