The above figure shows the payoff to two airlines, A and B, of serving a particular route
If the two airlines must decide simultaneously, and the government imposes a $20 per firm tax on firms that service this route, which of the following maximizes the firms' joint profits? A) Neither firm services the route.
B) Firm A offers firm B $20 to not enter.
C) Both firms will service this route.
D) Firm B offers firm A $30 to not enter.
B
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An example of a nontradable good is:
A. a lead-painted toy from China. B. a stack of firewood from Montreal, Canada. C. a dish of handmade pasta in Lucca, Italy. D. All of these would be considered a nontradable good.
Table 21.2Output (units per day)0102030Total cost (dollars per day)$40$54$62$80Average fixed cost at 20 units of output in Table 21.2 is
A. $1.00. B. $4.00. C. $2.50. D. $2.00.
Suppose that there are two industries, A and B. There are five firms in industry A with sales at $5 million, $2 million, $1 million, $1 million, and $1 million, respectively. There are four firms in industry B with equal sales of $2.5 million for each firm. The four-firm concentration ratio for industry A is:
A. 1.0. B. 0.7. C. 0.8. D. 0.9.
What is the difference between deflation and disinflation?
What will be an ideal response?