The Following Table Lists the Payoffs for Firm 1 and Firm

question 15

Multiple Choice

The following table lists the payoffs for Firm 1 and Firm 2 from three possible pricing strategies:
Table 10-3
$\begin{array}{l}\quad\quad\quad\quad\quad\quad\quad\quad\quad\text { Firm } 2\\\begin{array} { | c | c | c | c | } \hline \text { Firm 1 } & \text { High } & \text { Medium } & \text { Low } \\\hline \text { High } & 3,1 & 4,2 & 2,0 \\\hline \text { Medium } & 2,3 & 5,5 & 3,4 \\\hline \text { Low } & 5,4 & 7,5 & 5,2 \\\hline\end{array}\end{array}$
-Refer to Table 10-3. Identify Firm 2's dominant strategy.

• A) Its dominant strategy is medium prices.
• B) Firm 2 does not have a dominant strategy.
• C) Its dominant strategy is high prices.
• D) Its dominant strategy could be high or medium prices depending on Firm 1's response.
• E) Its dominant strategy is low prices.

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