Asked by
shaily verma
on Oct 27, 2024
Verified
Gary's Gas and Frank's Fuel are the only two providers of gasoline in their town.Gary and Frank decide to form a cartel.Later,Gary summarizes his pricing strategy as,"I'll cheat on the cartel because,regardless of what Frank does,cheating gives me the best payoff." This is an example of:
A) a dominant strategy.
B) a tit-for-tat strategy.
C) an irrational strategy.
D) product differentiation.
Dominant Strategy
A strategy that is best for a player in a game regardless of what strategies other players choose.
Cartel
An agreement among competing firms to control prices or exclude entry of a new competitor in a market, often to maximize profits collectively.
- Identify actions as paramount strategies when they secure the optimal advantage, irrespective of the maneuvers of others.
Verified Answer
WR
Learning Objectives
- Identify actions as paramount strategies when they secure the optimal advantage, irrespective of the maneuvers of others.