Use the following table to answer the question : Table 15-3: Abbott and Costello are two firms that compete with each other in the market for ice-cream.They can price their product at a high,medium,or low price.The following matrix shows their profits from their respective pricing strategies.

-Refer to Table 15-3.When the concept of iterated dominance is used,Abbott and Costello will:
A)not arrive at a unique pricing strategy.
B)use the medium-pricing strategy.
C)use the high-pricing strategy.
D)use the low-pricing strategy.

Question

Use the following table to answer the question : Table 15-3: Abbott and Costello are two firms that compete with each other in the market for ice-cream.They can price their product at a high,medium,or low price.The following matrix shows their profits from their respective pricing strategies.

-Refer to Table 15-3.When the concept of iterated dominance is used,Abbott and Costello will:

-Refer to Table 15-3.When the concept of iterated dominance is used,Abbott and Costello will:
A)not arrive at a unique pricing strategy. 
B)use the medium-pricing strategy. 
C)use the high-pricing strategy. 
D)use the low-pricing strategy.

Quizplus · Accepted Answer

Iterated dominance involves eliminating strategies that are dominated, leading Abbott and Costello to choose the medium-pricing strategy as it is the best response after eliminating dominated strategies.

Use the Following Table to Answer the Question : Table