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The payoff matrix in the figure to the right shows the payoffs for a pricing game. If you were firm A , which strategy would
The payoff matrix in the figure to the right shows the payoffs for a pricing game.
If you were firm A which strategy would you choose?
Firm A should
A price high because this is their dominant strategy.
B price low because this maximizes profits of both firms.
C price low because this is their titfortat strategy.
D price low because this is their dominant strategy.
E price high because this is their maximin strategy.
Firm Bs dominant strategy is to price
If this game were repeated a large number of times and you were firm A and you could change your strategy, what might you do
Firm A should
A use a titfortat strategy by minimizing the maximum gain that can be earned.
B use a titfortat strategy by selecting a price that minimizes firm Bs profits.
C use a maximin strategy by by responding in kind to firm Bs play.
D use a titfortat strategy by responding in kind to firm Bs play.
E use a maximin strategy by maximizing the minimum gain that can be earned.
Please answer based on the informationnumbers on the graphic.
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