Read the Andrew Sorkin article, “As Oil Prices Fall, Airfares Still Stay High”, on a preceding page. Prompts:

Description

a.) Describe the characteristics of the market structure of the airline industry applying specific terms to explain the market characteristics of this industry (see Note below) and explain how strategic interdependence specifically applies to the industry price setting abilities or practices described in the article. b.) Also, using game theory describe what you think a Nash equilibrium would look like among the players in the airline industry described in the article and how does the Prisoner’s dilemma apply to this situation, if at all?