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Refer to the Information Provided in Table 14 -Refer to Table 14

Question 121

Multiple Choice

Refer to the information provided in Table 14.3 below to answer the question that follows.
Table 14.3
B's Strategy
 Advertise  Don’t Advertise  A’s profit $200 A’s profit $75 million million  Advertise  B’s profit $75 million  B’s profit $50 million  A’s Strategy  A’s profit $50 A’s profit $100 Don’t  million  million  B’s profit $200 B’sprofit $100 Advertise  million  million \begin{array} { l l l l } \hline & & { \text { Advertise } } & { \text { Don't Advertise } } \\\hline & & & \text { A's profit } \$ 200 \\& & \text { A's profit } \$ 75 \text { million million } \\ & \text { Advertise } & \text { B's profit } \$ 75 \text { million } \text { B's profit } \$ 50 \text { million } \\\text { A's Strategy } & & & \\& & \text { A's profit } \$ 50 & \text { A's profit } \$ 100 \\& \text { Don't } & \text { million } & \text { million } \\& & \text { B's profit } \$ 200 & \text { B'sprofit } \$ 100 \\& \text { Advertise } & \text { million } & \text { million }\end{array}
-Refer to Table 14.3. The result of this game is a prisoners' dilemma. In which of the following cases is it most likely that the firms will be able to overcome the prisoners' dilemma?


A) repeated play
B) a single interaction
C) when both firms follow a maximin strategy
D) government intervention

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