wo firms compete for a market of value 2. Each one can behave aggressively (fight) or peacefully (accommodate). If both accommodate, the market is split equally between them (each receives 1). If one accommodates and the other fights, the latter takes all (2) and the former is left empty-handed (0). If both fight, each wins the market with probability 1/2, so that each obtains 1 in expectation. When both choose to fight, however, the fight produces a damage of value −k for each firm. The value of the damage can be either k = 1/2 or k = 2. wo firms compete for a market of value 2. Each one can behave aggressively (fight) or peacefully (accommodate). If both accommodate, the market is split equally between them (each receives 1). If one accommodates and the other fights, the latter takes all (2) and the former is left empty-handed (0). If both fight, each wins the market with probability 1/2, so that each obtains 1 in expectation. When both choose to fight, however, the fight produces a damage of value −k for each firm. The value of the damage can be either k = 1/2 or k = 2.