Use the Following Case from Question

question 2

Multiple Choice

Use the following case from question
Irene's Dairy is deciding whether or not to enter the market for ice cream,currently monopolized by Mattie's Ice-cream.If it enters the market,Mattie's can either accommodate him and share his 10million in profits equally with Irene or fight him and cause a 5million loss for each in a price war.​
-​If Mattie wants to discourage Irene from entering the market,what strategy should she follow?

• A)​Threaten to always accommodate
• B)Always accommodate
• C)Threaten to always fight
• D)​All of the above

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Definitions:

Personal Income

The total amount of income earned by an individual from all sources before any taxes are deducted.

Autonomous Consumption

Describes the expenditure that consumers will make even when they have no income, considering it as a basic level of consumption driven by needs.

Saving

The act of setting aside money for future use, reducing current consumption.

Induced Consumption

Consumer spending that increases or decreases as a result of changes in income, as opposed to autonomous consumption that does not change with income.