Table 14-2 Table 14-2 Shows the Payoff Matrix for Wal-Mart and Target

question 131

Multiple Choice

Table 14-2

Table 14-2 shows the payoff matrix for Wal-Mart and Target from every combination of pricing strategies for the popular PlayStation 4.At the start of the game each firm charges a low price and each earns a profit of $7,000.
-Refer to Table 14-2.Suppose Wal-Mart and Target both advertise that they will match the lowest price offered by any competitor.What is the purpose of such a strategy?

• A)to signal to each other not to charge below the current low price
• B)to signal to each other that they will not hesitate to initiate a price war
• C)to signal to each other that they intend to charge the high price
• D)to signal to each other to share the market equally

---

Definitions:

Negative Way

A perspective or approach that tends to focus on the unfavorable aspects of situations or on what can go wrong.

Progressive Muscle Relaxation

A technique involving the sequential tensing and relaxing of muscle groups to reduce stress and promote relaxation.

Systolic Blood Pressure

The pressure in the arteries when the heart beats and fills them with blood.

Deep Breathing Techniques

Methods used to take slow, deep breaths to fully engage the diaphragm and improve oxygen exchange, often used for stress reduction and relaxation.