1) Define Cartel and give an example.2) Thelma and Louise are being charged for a murder/robbery. They areseparated by police and interrogated. They are given the choice to confess ornot to confess. The payoff matrix below identifies the years that they will eachspend in jail, for the various outcomes.LouiseConfessDon't ConfessConfess(210,1015.2ThelmaDon't Confess2,153,3a. Identify the Dominant Strategy for either player, or state that there isn't one.Remember, a "Strategy" is the players move. In this example, state "Confess" or"Don't Confess" for each player, not the payoff.b. Identify the Nash Equilibrium. 3) Amazon and Target both sell the new Xbox, and have a choice whether tocharge a high price or a low price. The payoff matrix identifies the profit eitherstore can expect to make (in millions of dollars).WalmartHigh PriceLow Priceb. Identify the Nash Equilibrium.High PriceSearch entries or author3,6Unread5,5Amazona. Identify the Dominant Strategy for either player, or write "none" if there isn'tone,nLow Price2,84,3

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Answered: 1) Define Cartel and give an example.

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1) Define Cartel and give an example.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

1) Define Cartel and give an example.
2) Thelma and Louise are being charged for a murder/robbery. They are
separated by police and interrogated. They are given the choice to confess or
not to confess. The payoff matrix below identifies the years that they will each
spend in jail, for the various outcomes.
Louise
Confess
Don't Confess
Confess
(2
10,10
15.2
Thelma
Don't Confess
2,15
3,3
a. Identify the Dominant Strategy for either player, or state that there isn't one.
Remember, a "Strategy" is the players move. In this example, state "Confess" or
"Don't Confess" for each player, not the payoff.
b. Identify the Nash Equilibrium.

3) Amazon and Target both sell the new Xbox, and have a choice whether to
charge a high price or a low price. The payoff matrix identifies the profit either
store can expect to make (in millions of dollars).
Walmart
High Price
Low Price
b. Identify the Nash Equilibrium.
High Price
Search entries or author
3,6
Unread
5,5
Amazon
a. Identify the Dominant Strategy for either player, or write "none" if there isn't
one,
n
Low Price
2,8
4,3

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Explain why OPEC has been one of the most successful cartels in recent decades. Whatfactors have limited this success?
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