Two competing coffee shops, 'Brew & Co.' and 'The Daily Grind', are deciding on their weekly promotion. They can either offer a 'Discount' or introduce a 'New Pastry'. The table below shows the potential daily profits (in thousands of dollars) for each shop based on the combination of their choices. The first number in each pair is the profit for Brew & Co., and the second is for The Daily Grind.
| The Daily Grind: Discount | The Daily Grind: New Pastry | |
|---|---|---|
| Brew & Co.: Discount | (10, 12) | (15, 8) |
| Brew & Co.: New Pastry | (8, 14) | (12, 10) |
If Brew & Co. anticipates that The Daily Grind will introduce a 'New Pastry', what is Brew & Co.'s best response to maximize its own profit?
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Two competing coffee shops, 'Brew & Co.' and 'The Daily Grind', are deciding on their weekly promotion. They can either offer a 'Discount' or introduce a 'New Pastry'. The table below shows the potential daily profits (in thousands of dollars) for each shop based on the combination of their choices. The first number in each pair is the profit for Brew & Co., and the second is for The Daily Grind.
The Daily Grind: Discount The Daily Grind: New Pastry Brew & Co.: Discount (10, 12) (15, 8) Brew & Co.: New Pastry (8, 14) (12, 10) If Brew & Co. anticipates that The Daily Grind will introduce a 'New Pastry', what is Brew & Co.'s best response to maximize its own profit?
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