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Exhibit 9-4  Two-Firm Payoff Matrix Assume Costs Are Identical for the Two

Question 138

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Exhibit 9-4  Two-Firm Payoff Matrix Exhibit 9-4  Two-Firm Payoff Matrix Assume costs are identical for the two firms in Exhibit 9-4. If both firms were allowed to form a cartel and agree on their prices, equilibrium would be established by: A) Beta Co. charging $1,000 and Alpha Co. charging $1,000. B) Beta Co. charging $1,000 and Alpha Co. charging $500. C) Beta Co. charging $500 and Alpha Co. charging $500. D) Beta Co. charging $500 and Alpha Co. charging $1,000. Assume costs are identical for the two firms in Exhibit 9-4. If both firms were allowed to form a cartel and agree on their prices, equilibrium would be established by:


A) Beta Co. charging $1,000 and Alpha Co. charging $1,000.
B) Beta Co. charging $1,000 and Alpha Co. charging $500.
C) Beta Co. charging $500 and Alpha Co. charging $500.
D) Beta Co. charging $500 and Alpha Co. charging $1,000.

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