Table 17-19 Consider a Small Town That Has Two Grocery Stores from Stores

question 265

Multiple Choice

Table 17-19
Consider a small town that has two grocery stores from which residents can choose to buy a loaf of bread. The store owners each must make a decision to set a high bread price or a low bread price. The payoff table, showing profit per week, is provided below. The profit in each cell is shown as (Store 1, Store 2) .
-Refer to Table 17-19. What is grocery store 2's dominant strategy?

• A)Grocery store 2 does not have a dominant strategy.
• B)Grocery store 2 should always set a low price.
• C)Grocery store 2 should always set a high price.
• D)Grocery store 2 should set a low price when grocery store 1 sets a low price, and grocery store 2 should set a high price when grocery store 1 sets a high price.

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Definitions:

Incremental Change

A gradual, step-by-step approach to modifying processes, products, or services, often as part of a strategy to manage risk or introduce innovation.

Transformational Change

A profound or radical shift that fundamentally alters the nature or direction of an entity.

Modest Change

A minor adjustment or slight modification to a process, system, or product.

Gradual Change

Incremental alterations, modifications, or developments occurring slowly over a period of time.