George and Jerry Are Competitors in a Local Market

question 318

Multiple Choice

George and Jerry are competitors in a local market. Each is trying to decide if it is better to advertise on TV, on radio, or not at all. If they both advertise on TV, each will earn a profit of $3,000. If they both advertise on radio, each will earn a profit of $5,000. If neither advertises at all, each will earn a profit of $10,000. If one advertises on TV and the other advertises on radio, then the one advertising on TV will earn $4,000 and the other will earn $2,000. If one advertises on TV and the other does not advertise, then the one advertising on TV will earn $8,000 and the other will earn $5,000. If one advertises on radio and the other does not advertise, then the one advertising on radio will earn $9,000 and the other will earn $6,000. If both follow their dominant strategy, then George will

• A)advertise on TV and earn $3,000.
• B)advertise on radio and earn $5,000.
• C)advertise on TV and earn $8,000.
• D)not advertise and earn $10,000.

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Definitions:

Social Empathy

The ability to understand and share the feelings of others within a social context.

Developing Resources

The process of identifying, creating, or enhancing assets and means that can be used to achieve goals or improve functionality.

Macro-level Change

Transformations or interventions aimed at influencing larger systems or communities, rather than individual level changes.

Theories

Systematically organized principles or explanations that serve to understand, predict, or explain phenomena.