In the Spring of 1994, Northwest Airlines Took the Independent

question 137

Multiple Choice

In the spring of 1994, Northwest Airlines took the independent action of reducing fares on its flights. Other competing airlines quickly matched the fare cuts. These actions might be interpreted as:

• A) a noncooperative game.
• B) a cooperative game.
• C) a constant sum game.
• D) a competitive game.

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Definitions:

Crab Dip

A savory spread or appetizer made primarily from crab meat mixed with cream cheese, herbs, and spices.

Crackers

A dry, thin baked food typically made from flour and seasoned.

Utility-maximizing

A principle in economics where consumers aim to get the greatest satisfaction from their spending, given their budget constraint.

Goods

Tangible items that are produced and are capable of being physically delivered to a consumer.