Zippy's and Tony's Are Rival Pizza Restaurants in a Small

question 106

Multiple Choice

Zippy's and Tony's are rival pizza restaurants in a small town. (Together they form a local duopoly.) Zippy's management determines that if it increases its advertising expenditures, it will increase profits regardless of whether Tony's increases its advertising budget. Based on this information, we can conclude that

• A)this is a one-time game.
• B)Zippy's has a dominant strategy in this advertising game.
• C)this advertising game will reach a Nash equilibrium.
• D)Zippy's has first-mover advantages in this advertising game.

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Definitions:

Presumed Revoked

The assumption that a legal document, like a will or license, is no longer valid or in effect without direct evidence.

Electrical Fire

A type of fire caused by electrical failures or malfunctions, such as faulty wiring, overloaded circuits, or defective electrical devices.

Consideration

An item of worth provided by each party in a contract, motivating them to engage in the deal for the purpose of exchanging reciprocal actions.

Enforce

To enforce adherence to or fulfillment of a regulation, statute, or duty.