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Game Theory Lect # 2

Company A and B both sell flu medicine and use different advertising methods like radio, TV, and newspapers. Company B also uses mail brochures. A payoff matrix summarizes the percentage of the market that Company A could gain or lose depending on the effectiveness of each company's advertising campaigns.

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Dr-Junaid Shaju
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413 views5 pages

Game Theory Lect # 2

Company A and B both sell flu medicine and use different advertising methods like radio, TV, and newspapers. Company B also uses mail brochures. A payoff matrix summarizes the percentage of the market that Company A could gain or lose depending on the effectiveness of each company's advertising campaigns.

Uploaded by

Dr-Junaid Shaju
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Game theory (Lecture # 2 )

Pay Off matrix With a Practical Example


Two companies, A and B, sell two brands of flu medicine. Company A advertises in
radio (A1), television (A2), and newspapers (A3). Company B, in addition to using
radio (B1), television (B2), and newspapers (B3), also mails brochures (B4).
Depending on the effectiveness of each advertising campaign, one company can
capture a portion of the market from the other. The following matrix summarizes
the percentage of the market captured or lost by company A:
Practice Problems
Optional for this lecture

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