(Figure: Nike and Reebok Sales) Use Figure: Nike and Reebok Sales. Reebok and Nike must decide whether to have a sale or not, based on the potential economic profits shown in the table. The BEST response for Nike is:

Question

(Figure: Nike and Reebok Sales) Use Figure: Nike and Reebok Sales. Reebok and Nike must decide whether to have a sale or not, based on the potential economic profits shown in the table. The BEST response for Nike is:
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Quizplus · Accepted Answer

Based on the table, if Reebok has a sale, Nike's economic profit would decrease from $20 million to $15 million. However, if Nike also has a sale, its economic profit would increase from $20 million to $25 million. Therefore, Nike's best response would be to have a sale regardless of what Reebok chooses to do.