Table 17-18 This Table Shows a Game Played Between Two Firms, Firm

question 260

Multiple Choice

Table 17-18
This table shows a game played between two firms, Firm A and Firm B. In this game each firm must decide how much output (Q) to produce: 10 units or 12 units. The profit for each firm is given in the table as (Profit for Firm A, Profit for Firm B) .
-Refer to Table 17-18. The Nash equilibrium for this game is

• A)10 units of output for Firm A and 10 units of output for Firm B.
• B)10 units of output for Firm A and 12 units of output for Firm B.
• C)12 units of output for Firm A and 10 units of output for Firm B.
• D)12 units of output for Firm A and 12 units of output for Firm B.

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Definitions:

Disposable Income

Resources earmarked for household financial activities in saving and spending following income tax calculations.

Saving

The segment of one's income that is not consumed but saved for future investments or use.

Consumption

The act of using goods and services for personal needs or to satisfy consumer demands.

APS

Average Propensity to Save, the proportion of total income that is saved by the economy or an individual.