Table 16-2 In the Following Duopoly Game, the Two Firms Can Either

question 163

Multiple Choice

Table 16-2
In the following duopoly game, the two firms can either set the price of their product high or low. If one firm's price is lower than the other, most of the market will buy from them. This will increase the low-price firm's profit at the expense of the other firm. The game is represented in the table below.

-Refer to Table 16-2. What is the profit firm A will earn if it plays its dominant strategy:

• A) $1000 if firm B has a high price and $1500 if firm B has a low price
• B) $1000 if firm B has a high price and $800 if firm B has a low price
• C) $800 if firm B has a high price and $1250 if firm B has a low price
• D) $800 if firm B has a high price and $1500 if firm B has a low price

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Definitions:

Objective Statement

A concise and clear declaration of the goals or intent, often seen at the beginning of resumes.

Heart Rate

The number of heartbeats per unit of time, usually measured in beats per minute (bpm), indicating the rate at which the heart is working.

Elevated

A term often used to describe an increase or higher level of something, such as elevated body temperature, suggesting a fever or infection.

Chronological Order

The arrangement of events, dates, or occurrences in the order of their time of occurrence.