Price Wars Can Be the Result of

question 12

Multiple Choice

Price wars can be the result of

• A) new firms entering an industry and all firms then finding themselves in a prisoners' dilemma.
• B) a cooperative equilibrium.
• C) a firm playing a tit- for- tat strategy in which in the last period the competitors complied with a collusive agreement.
• D) new firms entering the industry and immediately agreeing to abide by a collusive agreement.

---

Definitions:

Funded Status

A measure of a pension plan's assets relative to its liabilities, indicating whether it has enough assets to cover its pension obligations.

Pension Discount Rate

The interest rate used to determine the present value of future pension liabilities.

Current Cash Flows

The money that is moving in and out of a business in the present time, especially as it pertains to operating activities.

Past Service Costs

Costs related to pension plan benefits earned by employees in prior periods, which are recognized in the current period due to plan amendments or changes.