-The Above Figure Shows a Payoff Matrix for Two Firms

question 71

Multiple Choice

-The above figure shows a payoff matrix for two firms, A and B, that must choose between a high-price strategy and a low-price strategy. Both firms setting a high price is NOT a Nash equilibrium because

• A)setting a high price is the dominant strategy for each firm.
• B)neither firm can improve its payoff by setting a low price given that the other firm is setting a high price.
• C)there is no dominant strategy for either firm.
• D)both firms can improve their payoff by setting a low price given that the other firm is setting a high price.

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A curve depicting the maximum attainable combinations of two products that a society can produce with available resources and technology.

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A curve depicting all maximum output possibilities for two goods, given a set of inputs, representing the trade-offs between the two commodities.