Two pita-bread stores (Pita Pan and Pita Wrapbit) have both recently opened up in a new suburb and are interested in expanding their market share. Both are considering advertising in the surrounding area to entice more customers to come to their stores. The following table depicts the strategic outcome that results from the game. The profits of the two pita-bread stores under two advertising scenarios are shown. Pita Wrapbit Advertise Do Not Advertise Pita Pan Advertise Pita Pan = $750 Pita Pan = $2950 Pita Wrapbit = $400 Pita Wrapbit = $350 Do Not Advertise Pita Pan = $250 Pita Pan = $1450 Pita Wrapbit = $2600 Pita Wrapbit = $950 If both stores follow a dominant strategy, Pita Pan's profits will be: Select one: O a $250 O b. $1450 O c. $2950 O d. $750
Two pita-bread stores (Pita Pan and Pita Wrapbit) have both recently opened up in a new suburb and are interested in expanding their market share. Both are considering advertising in the surrounding area to entice more customers to come to their stores. The following table depicts the strategic outcome that results from the game. The profits of the two pita-bread stores under two advertising scenarios are shown. Pita Wrapbit Advertise Do Not Advertise Pita Pan Advertise Pita Pan = $750 Pita Pan = $2950 Pita Wrapbit = $400 Pita Wrapbit = $350 Do Not Advertise Pita Pan = $250 Pita Pan = $1450 Pita Wrapbit = $2600 Pita Wrapbit = $950 If both stores follow a dominant strategy, Pita Pan's profits will be: Select one: O a $250 O b. $1450 O c. $2950 O d. $750
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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q13-
Transcribed Image Text:Two pita-bread stores (Pita Pan and Pita Wrapbit) have both recently opened up in a new suburb and are interested in expanding their market share. Both are considering advertising in the
surrounding area to entice more customers to come to their stores. The following table depicts the strategic outcome that results from the game. The profits of the two pita-bread stores under
two advertising scenarios are shown.
Pita Wrapbit
Advertise
Do Not Advertise
Pita Pan
Advertise
Pita Pan = $750
Pita Pan =
$2950
Pita Wrapbit = $400
Pita Wrapbit = $350
%3D
Do Not Advertise
Pita Pan = $25O
Pita Pan =
$1450
%3D
Pita Wrapbit = $2600
Pita Wrapbit = $950
If both stores follow a dominant strategy, Pita Pan's profits will be:
Select one:
a.
$250
O b. $1450
C.
$2950
O d. $750
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