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Alpha and Beta are the only firms selling gyros in the upscale town of Delphi. Each firm must decide on whether to offer a discount to students to compete for customers. If one firm offers a discount but the other does not, then the firm that offers the discount will increase its profit. The figure shows the payoff matrix for this game. Does Beta have a dominant strategy and if so, what is it? OA. Yes, Beta should not offer a student discount. B. There are two dominant strategies: if Alpha offers a student discount then Beta's best bet is to not offer a student discount, but if Alpha does not offer a student discount then Beta should offer a student discount. C. Yes, Beta should offer a student discount. OD. No, there is no dominant strategy. Offer Alpha Don't offer Offer Alpha earns $60,000 Alpha earns $20,000 Beta earns $60,000 Beta earns $100.000 Beta Alpha earns $100,000 Don't offer Beta earns $20,000 Beta earns $80,000 Alpha earns $80,000 Time Remaining: 00:48:46 Next C

Alpha and Beta are the only firms selling gyros in the upscale town of Delphi. Each firm must decide on whether to offer a discount to students to compete for customers. If one firm offers a discount but the other does not, then the firm that offers the discount will increase its profit. The figure shows the payoff matrix for this game. Does Beta have a dominant strategy and if so, what is it? OA. Yes, Beta should not offer a student discount. B. There are two dominant strategies: if Alpha offers a student discount then Beta's best bet is to not offer a student discount, but if Alpha does not offer a student discount then Beta should offer a student discount. C. Yes, Beta should offer a student discount. OD. No, there is no dominant strategy. Offer Alpha Don't offer Offer Alpha earns $60,000 Alpha earns $20,000 Beta earns $60,000 Beta earns $100.000 Beta Alpha earns $100,000 Don't offer Beta earns $20,000 Beta earns $80,000 Alpha earns $80,000 Time Remaining: 00:48:46 Next C

Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter15: Strategic Games
Section: Chapter Questions
Problem 3MC
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Alpha and Beta are the only firms selling gyros in the upscale town of Delphi. Each firm must decide on whether to offer a discount to students to compete for customers. If one firm offers a discount but the other does not, then the firm that offers the discount will increase its profit. The figure shows the payoff matrix for this game. Does Beta have a dominant strategy and if so, what is it? OA. Yes, Beta should not offer a student discount. B. There are two dominant strategies: if Alpha offers a student discount then Beta's best bet is to not offer a student discount, but if Alpha does not offer a student discount then Beta should offer a student discount. C. Yes, Beta should offer a student discount. OD. No, there is no dominant strategy. Offer Alpha Don't offer Offer Alpha earns $60,000 Alpha earns $20,000 Beta earns $60,000 Beta earns $100.000 Beta Alpha earns $100,000 Don't offer Beta earns $20,000 Beta earns $80,000 Alpha earns $80,000 Time Remaining: 00:48:46 Next C
Transcribed Image Text:Alpha and Beta are the only firms selling gyros in the upscale town of Delphi. Each firm must decide on whether to offer a discount to students to compete for customers. If one firm offers a discount but the other does not, then the firm that offers the discount will increase its profit. The figure shows the payoff matrix for this game. Does Beta have a dominant strategy and if so, what is it? OA. Yes, Beta should not offer a student discount. B. There are two dominant strategies: if Alpha offers a student discount then Beta's best bet is to not offer a student discount, but if Alpha does not offer a student discount then Beta should offer a student discount. C. Yes, Beta should offer a student discount. OD. No, there is no dominant strategy. Offer Alpha Don't offer Offer Alpha earns $60,000 Alpha earns $20,000 Beta earns $60,000 Beta earns $100.000 Beta Alpha earns $100,000 Don't offer Beta earns $20,000 Beta earns $80,000 Alpha earns $80,000 Time Remaining: 00:48:46 Next C
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