Two men\'s clothing stores that compete for most of the market in a small town i

Question

Two men's clothing stores that compete for most of the market in a small town in Ohio must choose their advertising levels simultaneously. T & Son and Mr. B's, shows the weekly profit outcomes for the various edvertising I Mr. B's advertising level High Low HighA $4,000, $4,000$3,000, $5,000 Arbuckle &Son; advertising level LowC $5,000, $3,000 $3,500, $3,500 Which of the following statements is NOT true for the advertising decision facing Arbuckle &Son; and Mr. B when both firms choose a high level of advertising, they are in Nash equilibrium. O When both firm choose a low level of advertising, they are in Nash equilibrium. O This is a prisoners' dilemma decision situation. O Cell's B and C are not strategically stable O A dominant strategy equilibrium exists for Arbuckle and M: B

Explanation / Answer

A Nash equilibrium is an action profile a with the property that no player i can do better by choosing an action different from ai , given that every other player j adheres to aj .

as per this defination the nash equilibrium is when both do low advertising,

so answer is A

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.