If You Advertise and Your Rival Advertises,you Each Will Earn

question 72

Multiple Choice

If you advertise and your rival advertises,you each will earn $4 million in profits.If neither of you advertises,you will each earn $10 million in profits.However,if one of you advertises and the other does not,the firm that advertises will earn $1 million and the non-advertising firm will earn $5 million.If you and your rival plan to be in business for 10 years,then the Nash equilibrium is:

• A) for each firm to advertise every year.
• B) for neither firm to advertise in early years, but to advertise in later years.
• C) for each firm to not advertise in any year.
• D) for each firm to advertise in early years, but not advertise in later years.

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Definitions:

British Culture

The customs, traditions, and social behaviors of the people of the United Kingdom, encompassing literature, music, arts, and historical values.

British Colonies

were territories under the administration and control of the United Kingdom, established around the world from the 16th to the 20th centuries, playing a significant role in British economic and political expansion.

American

A term referring to something or someone originating from or related to the United States of America.

British Heritage

The legacy and cultural traditions inherited from Britain, including its history, architecture, and customs.