Multiple Choice
Zippy's and Tony's are rival pizza restaurants in a small town. (Together they form a local duopoly.) Zippy's management determines that if it increases its advertising expenditures, it will increase profits regardless of whether Tony's increases its advertising budget. Based on this information, we can conclude that
A) this is a one-time game.
B) Zippy's has a dominant strategy in this advertising game.
C) this advertising game will reach a Nash equilibrium.
D) Zippy's has first-mover advantages in this advertising game.
Correct Answer:
Verified
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