Table 15.2.8 -Refer to Table 15.2.8. Libertyville Has Two Optometrists, Dr. Smith

question 106

Multiple Choice

Table 15.2.8

-Refer to Table 15.2.8. Libertyville has two optometrists, Dr. Smith and Dr. Jones. Each optometrist can choose to advertise his service or not. The incomes of each optometrist, in thousands of dollars, are given in the payoff matrix above. Which of the following statements correctly describes Dr. Smith's strategy given what Dr. Jones may do?

• A)Dr. Smith advertises no matter what Dr. Jones does.
• B)Dr. Smith does not advertise no matter what Dr. Jones does.
• C)Dr. Smith advertises only if Dr. Jones doesn't advertise.
• D)Dr. Smith advertises only if Dr. Jones advertises.
• E)Dr. Smith does not advertise if Dr. Jones advertises.

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Definitions:

Marginal Product

The additional output that results from using one more unit of a production factor, keeping all other factors constant.

Total Output

The complete quantity of goods and services produced by an economy in a given period.

Life Expectancy

The average number of years an individual or group is expected to live, often used as a statistical measure of health and well-being in a population.

Input Markets

Markets where firms buy resources, services, and goods they need to produce their own products or provide services.