Use the Following to Answer Question

question 87

Multiple Choice

Use the following to answer question:
Figure: Payoff Matrix II for Blue Spring and Purple Rain
-(Figure: Payoff Matrix II for Blue Spring and Purple Rain) Use Figure: Payoff Matrix II for Blue Spring and Purple Rain.The figure describes two producers of bottled water.Suppose Blue Spring charges a high price and Purple Rain does the same.In the next period,Blue Spring charges a low price and Purple Rain incurs a loss.If Purple Rain responds with a tit-for-tat strategy,it will:

• A)always charge a low price-the same as its dominant strategy.
• B)make random changes in its price so that Blue Spring is left with no systematic strategy.
• C)charge a low price in the next period and thereafter charge the same price that Blue Spring charged in the previous period.
• D)always charge a high price.

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Definitions:

Back-Channel Communication

Verbal and non-verbal ways in which listeners let speakers know they are still listening.

Impression Management

The effort to control or influence the perceptions others have of us, often through the manipulation of information in social interactions.

Intimacy Equilibrium

The balance between the need for closeness and personal space in interpersonal relationships.

Credit Balance

The amount of money that a creditor owes to a debtor, reflecting payments exceeding charges on an account.