Table 17-19 Consider a small town that has two grocery stores from which residents can choose to buy a loaf of bread. The store owners each must make a decision to set a high bread price or a low bread price. The payoff table, showing profit per week, is provided below. The profit in each cell is shown as (Store 1, Store 2). Store 2 Low Price High Price Low Price (250, 250) (400, 50) Store 1 High Price (50, 400) (325, 325) Refer to Table 17-19. What is grocery store 2's dominant strategy? Grocery store 2 does not have a dominant strategy. O Grocery store 2 should always set a low price. O Grocery store 2 should always set a high price. Grocery store 2 should set a low price when grocery store 1 sets a low price, and grocery store 2 should set a high price when grocery store 1 sets a high price.
Table 17-19 Consider a small town that has two grocery stores from which residents can choose to buy a loaf of bread. The store owners each must make a decision to set a high bread price or a low bread price. The payoff table, showing profit per week, is provided below. The profit in each cell is shown as (Store 1, Store 2). Store 2 Low Price High Price Low Price (250, 250) (400, 50) Store 1 High Price (50, 400) (325, 325) Refer to Table 17-19. What is grocery store 2's dominant strategy? Grocery store 2 does not have a dominant strategy. O Grocery store 2 should always set a low price. O Grocery store 2 should always set a high price. Grocery store 2 should set a low price when grocery store 1 sets a low price, and grocery store 2 should set a high price when grocery store 1 sets a high price.
Chapter1: Making Economics Decisions
Section: Chapter Questions
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![Table 17-19
Consider a small town that has two grocery stores from which residents can choose to buy a loaf of bread.
The store owners each must make a decision to set a high bread price or a low bread price. The payoff table,
showing profit per week, is provided below. The profit in each cell is shown as (Store 1, Store 2).
Store 2
Low Price
High Price
Low Price
(250, 250)
(400, 50)
Store 1
High Price
(50, 400)
(325, 325)
Refer to Table 17-19. What is grocery store 2's dominant strategy?
Grocery store 2 does not have a dominant strategy.
O Grocery store 2 should always set a low price.
O Grocery store 2 should always set a high price.
Grocery store 2 should set a low price when grocery store 1 sets a low price, and grocery store 2 should
set a high price when grocery store 1 sets a high price.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb2562a05-d595-4b52-9948-0022cdc15b6a%2F0172911a-d5f1-4a72-b75f-f3e3d790c0e9%2Foyltfv_processed.png&w=3840&q=75)
Transcribed Image Text:Table 17-19
Consider a small town that has two grocery stores from which residents can choose to buy a loaf of bread.
The store owners each must make a decision to set a high bread price or a low bread price. The payoff table,
showing profit per week, is provided below. The profit in each cell is shown as (Store 1, Store 2).
Store 2
Low Price
High Price
Low Price
(250, 250)
(400, 50)
Store 1
High Price
(50, 400)
(325, 325)
Refer to Table 17-19. What is grocery store 2's dominant strategy?
Grocery store 2 does not have a dominant strategy.
O Grocery store 2 should always set a low price.
O Grocery store 2 should always set a high price.
Grocery store 2 should set a low price when grocery store 1 sets a low price, and grocery store 2 should
set a high price when grocery store 1 sets a high price.
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