In the Game Shown Below, Firms 1 and 2 Must

question 56

Multiple Choice

In the game shown below, firms 1 and 2 must independently decide whether to charge high or low prices. Which of the following are Nash equilibrium payoffs in the one-shot game?

• A) (0, 0)
• B) (5, -5)
• C) (-5, 5)
• D) (10, 10)

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Definitions:

Subducted Plate

A tectonic plate that is being forced underneath another plate into the Earth's mantle at a convergent boundary.

Ophiolite

A portion of the Earth's oceanic crust along with the upper mantle beneath it that has been elevated and is now visible above the surface of the sea.

Oceanic Crust

The part of the Earth's crust that underlies the ocean basins, generally thinner and more dense than continental crust, formed at mid-ocean ridges and recycled into the mantle at subduction zones.

Sheeted Dikes

A geological formation consisting of numerous parallel dikes formed when magma intrudes into a crack then solidifies.