Consider a market with two firms, Target and Wal-Mart, that sell CDs in their musicdepartment. Both stores must choose whether to charge a high price ($30) or a low price(s13) for the new Miley Cyrus CD.These price strategies with corresponding profits are depicted in the payoff matrix to theright. Target's profits are in red and Wal-Mart's are in blue.TargetTarget's dominant strategy is to pick a price of SPrice = $30 Price = $13$7,000$2.500Price = $30S7,000$15,000Wal - Mart$15.000$5,000Price = $13$2,500$5,000Wal-Mart's dominant strategy is to pick a price of $The new equilibrium market wage will beand the new equilibrium market employment level will behigherunchangedlowerhigherlowerunchanged

Target dominant strategy is to pick a price of $13.

Consider a market with two firms, Target and Wal-Mart, that sell CDs in their music department. Both stores must choose whether to charge a high price (S30) or a low price ($13) for the new Miley Cyrus CD. These price strategies with corresponding profits are depicted in the payoff matrix to the right. Target's profits are in red and Wal-Mart's are in blue. Target's dominant stratogy is to pick a price of $O Price = $30 Target Price = $13 $7,000 $2.500 Price = $30 $7,000 $15,000 Wal - Mart $15,000 Price $13 $5.000 $2.500 $5,000 Wal-Mart's dominant strategy is to pick a price of $_ The new equilibrium market wage will be and the new equilibrium market employment level will be higher unchanged lower higher lower unchanged

Consider a market with two firms, Target and Wal-Mart, that sell CDs in their music department. Both stores must choose whether to charge a high price (S30) or a low price ($13) for the new Miley Cyrus CD. These price strategies with corresponding profits are depicted in the payoff matrix to the right. Target's profits are in red and Wal-Mart's are in blue. Target's dominant stratogy is to pick a price of $O Price = $30 Target Price = $13 $7,000 $2.500 Price = $30 $7,000 $15,000 Wal - Mart $15,000 Price $13 $5.000 $2.500 $5,000 Wal-Mart's dominant strategy is to pick a price of $_ The new equilibrium market wage will be and the new equilibrium market employment level will be higher unchanged lower higher lower unchanged

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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