Answer the question based on the following payoff matrix for a duopoly in which

Question

Answer the question based on the following payoff matrix for a duopoly in which the numbers indicate the profit from following either an international strategy or a national strategy. Firm A's Strategies International National B-$3M B = $15M B $5M S. If firm A chooses an international strategy while firm B chooses a national strategy, then the payoffs will be A) $3M for both firms B) $17M for both firms C) $15 for firm A and $5 for firm B D) $5 for firm A and $15 for firm B 6. If firm A chooses its dominant strategy and firm B chooses a strategy that is not dominant, then the ayoffs will be A) $3M for both firms B) $17M for both firms $15 for firm A and $5 for firm B D) $5 for firm A and $15 for firm B

Explanation / Answer

If a strategy is dominant, it earns a player a large pay-off than any other. Dominant strategy is better than any other strategy. According to the dominant strategy, option D is not correct as Firm A chooses dominant strategy regardless of how it affects Firm B. The best possible response or large pay off for Firm A will be $17M regardless of what outcome is for Firm B.

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

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