Asus

-Dell and Asus must decide whether to lower their prices, based on the potential economic profits shown in the payoff matrix above (in millions of dollars). If the firms collude and don't cheat, Dell's profit is _______ million and Asus's profit is _______ million.
A) $5; $20
B) $10; $10
C) $20; $5
D) $15; $15

Question

Asus
 
-Dell and Asus must decide whether to lower their prices, based on the potential economic profits shown in the payoff matrix above (in millions of dollars). If the firms collude and don't cheat, Dell's profit is _______ million and Asus's profit is _______ million.
A) $5; $20 
B) $10; $10 
C) $20; $5 
D) $15; $15

Quizplus · Accepted Answer

In a scenario where firms collude and do not cheat, they typically agree to keep prices high to maximize their profits. The option that reflects equal and maximized profits for both Dell and Asus, given the context of collusion, is $15 million each, which corresponds to option D.

Asus -Dell and Asus Must Decide Whether to Lower Their Prices