Question 3: Explain how Southwest Airlines used the game theory approach to increase its profits (20 %) a. What is the outcome of the game involving early-bird check-in?
Pay $10 for good seat
Pay $0 for a lottery style seating
Check the table with outcomes and explain why early-bird check-in is the outcome of the game.
Define dominant strategy.
Explain why early-bird check-in is the dominant strategy for Southwest Airlines customers.
Define Prisoner’s Dilemma.
Check the table with outcomes.
Explain why travelers face the Prisoner’s Dilemma with early-bird check-in.
Explain why travelers are essentially stuck in the early-bird check-in game.