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. to advertise.
B. dependent on what Firm B does.
C. to not advertise.
D. indeterminate from this information, as no information is provided on Firm A?s risk preference.
Answer: A
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From the late 1940s until the creation of the WTO, the organization that was primarily responsible for conducting rounds of trade negotiations was the
A) World Bank. B) IMF. C) ITO. D) United Nations. E) GATT.
A firm currently employs four workers in a sandwich shop, and produces sandwiches at a total cost per sandwich (ATC) of $3. The sandwiches sell for $5. If the marginal cost of hiring another worker to produce sandwiches is $5.50 per sandwich, then:
A. it will cost $5.50 to make another sandwich, which can only be sold for $5. B. the firm will lose $0.50 per sandwich if it hires another worker. C. the firm should not hire a fifth worker. D. All of these are true.
Given a series of contracts offered to an executive having the same slope (where slope refers to how the contract varies with changes in the firm's gross profits) but different intercepts (referring to the overall generosity of the contract). Which of these is not a consideration in figuring out which of these intercepts the shareholders would decide to build into the contract offered to the
executive? a. if too generous a contract is offered, this comes out of the firm's bottom-line profit. b. if too generous a contract is offered, the executive may become lazy and not exert the required effort. c. if the contract isn't generous enough, the executive will decide to work elsewhere. d. if the contract isn't generous enough, only low-ability executives will apply.
Under communism, _____________ owns and operates most of the means of production and distribution.
Fill in the blank(s) with the appropriate word(s).