Refer to the Table Below to Answer the Following Questions

question 30

Multiple Choice

Refer to the table below to answer the following questions.
Table 14.2.6
-Refer to Table 14.2.6.Firms A and B can conduct research and development (R&D) or not conduct it.R&D is costly but can increase the quality of the product and increase sales.The payoff matrix is the economic profits of the two firms and is given above,where the numbers are millions of dollars.A's best strategy is to

• A)conduct R&D regardless of what B does.
• B)not conduct R&D regardless of what B does.
• C)conduct R&D only if B conducts R&D.
• D)conduct R&D only if B does not conduct R&D.
• E)do whatever B does.

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Definitions:

Normal Good

A Normal Good is a type of good for which demand increases when income increases, and vice versa, holding all other factors constant.

Income Effect

The alteration in the income of a person or an economy and its impact on the demand for a particular good or service.

Leisure

The time available for ease and relaxation where no work is done, often considered as time spent away from business, work, job hunting, domestic chores, and education.

Workers' Incomes

The financial compensation received by employees for their labor, including wages, salaries, and bonuses.