In Repeated Negotiations Between Two Firms

question 22

Multiple Choice

In repeated negotiations between two firms:

• A) the bargaining behavior of the firms is motivated solely by the immediate profit available from an agreement.
• B) the reputation of a firm does not play a significant role.
• C) there is enhanced scope for purely opportunistic behavior by firms.
• D) The firm with less bargaining power is positioned to receive a greater share of the profit.
• E) firms have extra incentives to maintain a cooperative relationship.

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