Table 11-12

The payoff matrix shown above assumes that Perfect Plants and Florabunda Florist must decide whether to offer same-day delivery for their products. The matrix shows how much profit each firm will earn if it does or does not offer same-day delivery.The amount of profit for one firm depends on whether the other firm offers same-day delivery.
-Refer to Table 11-12.Which of the following statements is true?

Question

Table 11-12
  
The payoff matrix shown above assumes that Perfect Plants and Florabunda Florist must decide whether to offer same-day delivery for their products. The matrix shows how much profit each firm will earn if it does or does not offer same-day delivery.The amount of profit for one firm depends on whether the other firm offers same-day delivery.
-Refer to Table 11-12.Which of the following statements is true?

Quizplus · Accepted Answer

According to the payoff matrix, if Perfect offers same-day delivery and Florabunda does not, Perfect will earn a profit of $2,000 million, which is more than what it would earn if it does not offer same-day delivery ($1,500 million). Similarly, if Florabunda offers same-day delivery and Perfect does not, Florabunda will earn a profit of $2,000 million, which is more than what it would earn if it does not offer same-day delivery ($1,800 million). Therefore, Florabunda's best strategy is to offer same-day delivery if Perfect offers same-day delivery.

Table 11-12 the Payoff Matrix Shown Above Assumes That Perfect Plants and Assumes