Your text suggests that cigarette companies advertise too much. This is because they
A)do not know what the payoff options are.
B)seek to convince customers to switch brands and they have a dominant strategy to advertise in this case.
C)are pursuing a tit-for-tat strategy and are engaged in destructive behavior.
D)make the most money collectively if they advertise and increase the total market.

Question

Quizplus · Accepted Answer

Cigarette companies advertise heavily to persuade customers to switch brands, and in the context of game theory, they have a dominant strategy to advertise, as it maximizes their individual payoff regardless of the actions of their competitors.

Your Text Suggests That Cigarette Companies Advertise Too Much