Use the following table for the question below. Dynaco Decision Synergy Decision Large Budget Small Budget Large Synergy.gains.20.million Synergy gains zero Budget Dynaco gains 30 million Dynaco gains 70 million Small Synergy.gains.30.million Budget Dynaco gains zero Synergy.gains.40.million Dynaco gains 50 million If the two firms were allowed to work together (collude) and create a binding agreement, what is the optimal (best) outcome for both of them? O Synergy gains $40 million and Dynaco gains $50 million O Synergy gains zero Dynaco gains million O Synergy gains $20 million and Dynaco gains $30 million O Synergy gains $30 million and Dynaco gains zero

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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Question 18
Use the following table for the question below.
Dynaco
Decision
Synergy Decision
Large Budget
Small Budget
Large Synergy.gains.20.million Synergy gains zero
Budget Dynaco gains 30 million Dynaco gains 70 million
Small Synergy.gains.30.million
Budget Dynaco gains zero
Synergy.gains.40.million
Dynaco gains 50 million
If the two firms were allowed to work together (collude) and create a binding agreement, what is the optimal (best) outcome for both of them?
O Synergy gains $40 million and Dynaco gains $50 million
O Synergy gains zero and Dynaco gains $70 million
O Synergy gains $20 million and Dynaco gains $30 million
O Synergy gains $30 million and Dynaco gains zero
Transcribed Image Text:Question 18 Use the following table for the question below. Dynaco Decision Synergy Decision Large Budget Small Budget Large Synergy.gains.20.million Synergy gains zero Budget Dynaco gains 30 million Dynaco gains 70 million Small Synergy.gains.30.million Budget Dynaco gains zero Synergy.gains.40.million Dynaco gains 50 million If the two firms were allowed to work together (collude) and create a binding agreement, what is the optimal (best) outcome for both of them? O Synergy gains $40 million and Dynaco gains $50 million O Synergy gains zero and Dynaco gains $70 million O Synergy gains $20 million and Dynaco gains $30 million O Synergy gains $30 million and Dynaco gains zero
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