Jet Cruises Wants to Prevent Easy Sail from Entering the Sailboat

question 59

Multiple Choice

Jet Cruises wants to prevent Easy Sail from entering the sailboat market. The above game tree illustrates the different strategi corresponding payoffs for the two firms. Both Jet Cruises and Easy Sail have the same strategies of advertising (Ad) or not ad (No Ad) . The payoffs represent net profit in millions.
-If Jet Cruises chooses to No Ad and Easy Sail then chooses to No Ad, Jet Cruises earns million in net profit and Easy Sail earns _ million.

• A)$4; $3
• B)$2; $4
• C)$5; $2
• D)$10; $2

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Definitions:

Net Income

The remaining earnings of a company after subtracting total expenses and taxes from its gross revenue.

Dividends

Payments made by a corporation to its shareholders, usually out of profits or reserves.

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue; a key indicator of financial health.

Dividends

Profits distributed by a corporation to its share owners, regularly as a monetary payment.