Zuma ("Z") High price High price "T" earns $3 million Wide Awake ("W") Low "Z earns price $4 million "W earns $3 million "W earns $1 million Low price "Z earms $1 million Teams $2 million "Weams $4 milion "W'eams $2 milion Two rival oligopolists in the coffee industry have to decide on their pricing strategy. Each can choose either a high price or a low price. The table above shows the payoff matrix with the profits that each firm can expect to earn depending on the pricing strategy it adopts. Which of the following is true? OA) Wide Awake does not have a dominant strategy. OB) Zuma does not have a dominant strategy. OC) Zuma's dominant strategy is to select a high price. OD) Wide Awake's dominant strategy is to select a low price.

Zuma ("Z") High price High price "T" earns $3 million Wide Awake ("W") Low "Z earns price $4 million "W earns $3 million "W earns $1 million Low price "Z earms $1 million Teams $2 million "Weams $4 milion "W'eams $2 milion Two rival oligopolists in the coffee industry have to decide on their pricing strategy. Each can choose either a high price or a low price. The table above shows the payoff matrix with the profits that each firm can expect to earn depending on the pricing strategy it adopts. Which of the following is true? OA) Wide Awake does not have a dominant strategy. OB) Zuma does not have a dominant strategy. OC) Zuma's dominant strategy is to select a high price. OD) Wide Awake's dominant strategy is to select a low price.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter7: Consumers, Producers, And The Efficiency Of Markets

Section: Chapter Questions

Problem 8PA

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