-The Above Figure Shows the Payoff to Two Airlines,A and B,of

question 107

Multiple Choice

-The above figure shows the payoff to two airlines,A and B,of serving a particular route.If the two airlines must decide simultaneously,which one of the following statements is TRUE?

• A) Firm A has a dominant strategy.
• B) Firm B has a dominant strategy.
• C) Neither firm entering is a Nash equilibrium.
• D) The outcome of the game is unpredictable.

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Definitions:

Efficiency

The degree to which an entity optimizes the use of its resources to achieve its objectives, minimizing waste and maximizing output.

Equality

Refers to the state or quality of being equal, especially in status, rights, or opportunities.

Redistributes Income

The process by which government policies, taxation, and public spending aim to adjust the allocation of income across a society.

Efficiency

describes the extent to which resources are allocated in a way that maximizes the output or outcome, often considering waste minimization and optimal allocation in economic contexts.