Table 14-1 Godrickporter and Star Connections Are the Only Two Airport Shuttle

question 54

Multiple Choice

Table 14-1

Godrickporter and Star Connections are the only two airport shuttle and limousine rental service companies in the mid-sized town of Godrick Hollow.Each firm must decide on whether to increase its advertising spending to compete for customers.Table 14-1 shows the payoff matrix for this advertising game.
-Refer to Table 14-1.What is the Nash equilibrium in this game?

• A)There is no Nash equilibrium.
• B)Godrickporter increases its advertising budget, but Star Connections does not.
• C)Star Connections increases its advertising budget, but Godrickporter does not.
• D)Both Godrickporter and Star Connections increase their advertising budgets.

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Definitions:

Visitor

An individual who comes to a place for a short time for various purposes, including tourism, business, or leisure.

Cost-Per-Action

A pricing model in online advertising where the advertiser pays for each specified action (like a sale or click) linked to the advertisement.

Sales Revenues

The total amount of money generated from the sale of goods or services before any costs or expenses are deducted.

Social Media Ad

An advertising form that appears on social media platforms, designed to reach a target audience through demographic, interest-based, or behavioral targeting.