Answered: Choose all that apply A.)If Company A…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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These two firms are the only companies that sell a very similar product in California. They are trying to determine whether or not to sell their products via retail stores or online. The values represent profit for each firm and the first number represents profit to Company A and the second number to Company B. Choose all that apply

A.)If Company A opens a retail store, Company B is better off opening a retail store

B.)Company B has a mixed strategy

C.)If Company B opens a retail store, Company A is better off opening a retail store

D.)Company A's dominant strategy is to open retail stores

E.)The Nash equilibrium is the best outcome for both stores

Company B
Retail outlets No retail outlets
$25, $25
$30, $15
No retail outlets $35, $35
$34, $20
Company A Retail outlets

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