There are two independent dealers for Sporto automobiles in a large city
The dealers decide to run a cooperative advertising campaign in which both dealers are listed in local newspapers ads, and they can purchase larger ads that are more likely to attract attention and generate more auto sales if the dealers commit more funds to the joint advertising budget. Is this an example of a cooperative constant-sum game? A) Yes, each firm can contribute zero to 100 percent of the advertising budget, so this is a constant-sum game.
B) Yes, all negotiated outcomes between two firms are cooperative and constant-sum situations.
C) No, the outcome of the advertising campaign depends on how much money the firms contribute to the campaign, so it is not constant sum.
D) No, the firms are independent, so their interaction cannot be cooperative.
C
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The alternative minimum tax (AMT) was created to
A. make sure that everyone had an equal chance of facing a tax audit. B. make sure that upper income taxpayers could not use deductions to avoid paying income taxes. C. make sure poor people paid at least something in taxes. D. make sure that everyone paid the same proportion of their income in taxes.
Refer to the market diagram. Relative to the surplus achieved under perfect competition, how much surplus is lost (deadweight loss) when there is a monopoly?
The following questions refer to the accompanying market diagram. PC and QC are the equilibrium price and quantity if the firm behaves competitively, and PM and QM are the equilibrium price and quantity if the firm is a simple monopoly.
a. E
b. H
c. E + H
d. D + G + E + H
Employee theft is an example of ________
A) adverse selection B) moral hazard C) herd behavior D) internalizing of externalities
According to the theory of efficiency wages, firms operate more efficiently if wages are below the equilibrium level
a. True b. False Indicate whether the statement is true or false