Table 16-2
in the Following Duopoly Game, the Two Firms

question 49

Multiple Choice

Table 16-2
In the following duopoly game, the two firms can either set the price of their product high or low.The game is represented in the table below. $\begin{array}{|c|c|c|c|}\hline&&\text { Firm B }\\&&\text { High Price }&\text { Low Price }\\\hline \text { Firm A }&\text { High Price }&\text { Firm A gets \$1000 } & \text { Firm A get \$1250 } \\&& \text { Firm B gets \$1000 } & \text { Firm B gets \$1100 } \\\hline &\text { Low Price }&\text { Firm A gets \$800 } & \text { Firm A gets \$900 } \\&&\text { Firm B gets \$800 } & \text { Firm B gets \$900 } \\\hline\end{array}$
-Refer to Table 16-2.The Nash equilibrium for this game is for:

• A)both firms to sell the product at a low price
• B)both firms to sell the product at a high price
• C)firm A to sell at a low price and for firm B to sell at a high price
• D)firm A to sell at a high price and for firm B to sell at a low price

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Definitions:

Prejudice

Preconceived opinion or judgment about an individual or group that is not based on reason or actual experience, often involving negative or stereotypical beliefs.

Mixed-race

Pertaining to an individual or group of people who are of ancestry from two or more racial backgrounds.

Promoted

Refers to the act of being elevated to a higher rank or position within an organization.

Robber's Cave

Refers to a landmark social psychology experiment that demonstrated how intergroup conflict could be incited and then overcome through cooperative tasks.