The Payoff Matrix Below Shows the Daily Profit for Two

question 136

Multiple Choice

The payoff matrix below shows the daily profit for two firms, Row Restaurant and Column Cafe, for two different strategies, publishing coupons in the student paper and not publishing coupons in the student paper.  
The payoffs of this game are such that:

• A)if Row Restaurant expects Column Cafe to choose its dominant strategy, then Row Restaurant should choose its dominated strategy.
• B)profit at each firm is higher when they both follow their dominant strategy than when they both follow their dominated strategy.
• C)both firms would benefit from a law that made publishing coupons illegal.
• D)an agreement not to publish coupons would be easy to maintain because neither firm has an incentive to defect.

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