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Table A shows the pricing options for two hair salons, one operated by Sue and the other by Jane, as an oligopoly in a rural
Table A shows the pricing options for two hair salons, one operated by Sue and the other by Jane, as an oligopoly in a rural market. Which of the following pricing strategies does Table 5 depict? Table A
Pricing strategies for Sue's Hair Salon when charging the LOW Price | Pricing strategies for Sue's Hair Salon when charging the HIGH Price |
---|---|
If Sue and Jane both charge HIGH price, BOTH get $400 each | If Sue charges the HIGH price and Jane charges the LOW price, Sue GETS $0, and Jane gets $800 |
If Jane charges HIGH price and Sue charges LOW price, Jane gets $0 and Sue gets $800 | If Sue and Jane both charge the HIGH price, BOTH get $600 each |
TABLE 5 | First Period Choose High or low price | First Period Profit | Second Period Choose High or low price | Second Period Profit | Total Profit in both periods |
---|---|---|---|---|---|
Sue | High | $600 | High | $600 | $1,200 |
Jane | High | $600 | High | $600 | $1,200 |
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