For the following question
Consider a simultaneous move game between a union and a company.If both the parties bargain hard,each would gain nothing.If only one party bargains hard the accommodating party gets a profit of $1 million while the bargaining party gets a $5 million,while if they both accommodate,they each get $3 million.
-If the Union threatens a strike,what is the firm's best response?
A)Bargain hard
B)Accommodate
C)Run
D)Hide

Question

​For the following question
Consider a simultaneous move game between a union and a company.If both the parties bargain hard,each would gain nothing.If only one party bargains hard the accommodating party gets a profit of $1 million while the bargaining party gets a $5 million,while if they both accommodate,they each get $3 million.
-​If the Union threatens a strike,what is the firm's best response?
A)​Bargain hard
B)Accommodate
C)Run
D)​Hide

Quizplus · Accepted Answer

If the union threatens a strike, the firm should accommodate to avoid the worst outcome of both parties bargaining hard, which results in no gain. By accommodating, the firm ensures a profit of $1 million.

​For the Following Question

For the Following Question