Refer to the information provided in Table 14.2 below to answer the question that follows.
Table 14.2B's Strategy
?AdvertiseDon't Advertise??A's profit $100 millionA's profit $200 million?AdvertiseB's profit $100 millionB's profit $50 millionA's Strategy????Don'tA's profit $50 millionA's profit $75 million?AdvertiseB's profit $200 millionB's profit $75 millionRefer to Table 14.2. Firm A?s dominant strategy is
A. dependent on what Firm B does.
B. to not advertise.
C. to advertise.
D. indeterminate from this information, as no information is provided on Firm A?s risk preference.
Answer: C
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According to the invisible hand theorem, as stated in the text,
A. even non-competitive markets are able to achieve Pareto efficient outcomes. B. an equilibrium produced by competitive markets will exhaust all gains from exchange. C. non-market forces can prevent the markets from guiding consumers to the contract curve. D. government interaction is sometimes needed as an invisible hand to lead the economy toward efficiency.
Services can be thought of as
A) unvalued goods. B) unwanted goods. C) free goods. D) intangible goods.
Which agreement removes customs and passport controls at the common borders of many EU countries?
What will be an ideal response?
When the marginal utility per dollar of good A exceeds the marginal utility per dollar of good B,
A. good B must have a negative marginal utility. B. the consumer is consuming too much of good A. C. the consumer is in an optimal situation if the price of good A exceeds the price of good B. D. the consumer should consume more of good A.