The figure shown displays the choices that could be made by two coffee shops: Starbucks and Dunkin' Donuts. Both companies are trying to decide whether or not to expand into a new area. The area can only handle one coffee shop's expansion, and the expansion of one shop will cause the other to lose some business. If both coffee shops expand, the market will become saturated and neither will do well. The payoffs for these shops are the additional profits (or losses)they will earn.If these players act in their own self-interest, then Dunkin' Donuts will earn:
A)$2 million.
B)−$1 million.
C)−$2 million.
D)$0 million.

Question

The figure shown displays the choices that could be made by two coffee shops: Starbucks and Dunkin' Donuts. Both companies are trying to decide whether or not to expand into a new area. The area can only handle one coffee shop's expansion, and the expansion of one shop will cause the other to lose some business. If both coffee shops expand, the market will become saturated and neither will do well. The payoffs for these shops are the additional profits (or losses)they will earn.If these players act in their own self-interest, then Dunkin' Donuts will earn:
A)$2 million. 
B)−$1 million. 
C)−$2 million. 
D)$0 million.

Quizplus · Accepted Answer

The Answer of  The figure shown displays the choices that could be made by two coffee shops: Starbucks and Dunkin' Donuts. Both companies are trying to decide whether or not to expand into a new area. The area can only handle one coffee shop's expansion, and the expansion of one shop will cause the other to lose some business. If both coffee shops expand, the market will become saturated and neither will do well. The payoffs for these shops are the additional profits (or losses)they will earn.If these players act in their own self-interest, then Dunkin' Donuts will earn:
A)$2 million. 
B)−$1 million. 
C)−$2 million. 
D)$0 million.

The Figure Shown Displays the Choices That Could Be Made