The Following Table Shows the Payoff Matrix of the Two

question 44

Multiple Choice

The following table shows the payoff matrix of the two firms (Firm X and Firm Y) , in dollars, when they advertise and when they do not advertise.Table 12.1

-According to the payoffs in Table 12.1:

• A)firm X will not advertise, no matter what, if Firm Y does not advertise.
• B)firm X will advertise only if Firm Y does not advertise.
• C)firm X does not have a dominant strategy, but Firm Y does.
• D)firm Y does not have a dominant strategy, but Firm X does.
• E)both firms will be better off if neither of them advertised.

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Definitions:

Business Organization

The structure and framework within which an enterprise operates, detailing the roles, relationships, and responsibilities of its entities.

Pool Their Resources

To combine assets, funds, or talents of a group of people for a common purpose or to achieve a common goal.

Business Trust

A legal entity formed under trust law to pursue business activities, offering participants flexibility in management and investment.

Assets

Economic resources or owned items of value that an individual, company, or organization possesses.