Use the Table Below to Answer the Following Question

question 72

Multiple Choice

Use the table below to answer the following question.
Table 15.2.3

-Refer to Table 15.2.3. Store X and Store Y must decide whether or not to lower their prices. The table gives the economic profit made by Store X and Store Y. Which one of the following observations is correct?

• A)Both Store X and Store Y have a dominant strategy of raising their prices.
• B)If Store X lowers its prices and Store Y does not, Store X will earn a $20 profit.
• C)If Store Y lowers its prices, Store X will be better off not lowering its prices.
• D)Both Store X and Store Y would be better off if they could collude and agree to not lower prices.
• E)Both Store X and Store Y have a dominant strategy of lowering their prices.

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Definitions:

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