Use the Following to Answer Questions

question 183

Multiple Choice

Use the following to answer questions :
Figure: Pricing Strategy in Cable TV Market II
-(Figure: Pricing Strategy in Cable TV Market II) Use Figure: Pricing Strategy in Cable TV Market II.Suppose that,after 1 month,the cable providers follow a tit-for-tat strategy.Eventually,they will achieve a tacit collusive equilibrium at which:

• A) both firms set a low price and each earns $90 000.
• B) both firms set a high price and each earns $100 000.
• C) CableNorth sets a high price and earns $80 000,and CableSouth sets a low price and earns $130 000.
• D) CableNorth sets a low price and earns $130 000,and CableSouth sets a high price and earns $80 000.

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Definitions:

Gallaugher & Ransbotham

Researchers known for their contributions to understanding the digital business landscape and technology's impact on competition.

Microphone

A device for converting acoustic power into electric power that has an output signal voltage.

Megaphone

A metaphor to describe a means or channel that amplifies or broadcasts messages to a wide audience.

Magnet

In marketing, refers to an offer or content that attracts potential customers by addressing their needs or interests, much like a magnet attracts ferrous objects.