Refer to the information provided in Table 14.4 below to answer the question that follows.
Table 14.4B's Strategy
?Raise PriceDon't Raise Price?RaiseA's profit $6,000A's profit $20,000?PriceB's profit $6,000B's profit $30,000A's Strategy????Don'tA's profit $30,000A's profit $10,000?RaiseB's profit $20,000B's profit $10,000Refer to Table 14.4. The Nash equilibrium in the game is
A. (Raise Price, Don't Raise Price).
B. (Don't Raise Price, Raise Price).
C. (Don't Raise Price, Don't Raise Price).
D. Both A and B are correct.
Answer: D
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The steeper the LM curve
A) the more effective is monetary policy. B) the less effective is monetary policy. C) the greater is the interest-sensitivity of investment. D) the greater is the interest-sensitivity of the money supply.
Cooperation:
B. is sustained by the promise of punishment for good behavior. C. can be established even if threats/promises are not credible. D. All of these are true about cooperation.
If $1 is worth .8 Canadian dollars, then 1 Canadian dollar is worth:
A. $1.80. B. $1.25. C. $0.20. D. $0.80.
Which of the following would indicate a relatively large amount of market power?
A. Low cross-price elasticity with other products B. Highly price elasticity demand C. Low Lerner index D. all of the above E. none of the above