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Use the Table with Data for Bella and Martin to Answer

Question 51

Multiple Choice

Use the table with data for Bella and Martin to answer the question.
With no cooperation, the Nash equilibrium yields Bella a profit of _____ and Martin a profit of _____.
 Table: Bella’s and Martin’s Auto Oil Change Companies  Martin’s price =$35 Martin’s price =$50 Bella’s price = Bella’s profit =$4,000 Bella’s profit =$6,000$40 Martin’s profit =$3,500 Martin’s profit =$1,000 Bella’s price = Bella’s profit =$1,000 Bella’s profit =$5,000 $55  Martin’s profit =$5,500 Martin’s profit =$5,000\begin{array}{l}\text { Table: Bella's and Martin's Auto Oil Change Companies }\\\begin{array} { | l | l | l | } \hline & { \text { Martin's price } = \$ 35 } & { \text { Martin's price } = \$ 50 } \\\hline \text { Bella's price } = & \text { Bella's profit } = \$ 4,000 & \text { Bella's profit } = \$ 6,000 \\\$ 40 & \text { Martin's profit } = \$ 3,500 & \text { Martin's profit } = \$ 1,000 \\\hline \text { Bella's price } = & \text { Bella's profit } = \$ 1,000 & \text { Bella's profit } = \$ 5,000 \\\text { \$55 } & \text { Martin's profit } = \$ 5,500 & \text { Martin's profit } = \$ 5,000 \\\hline\end{array}\end{array}


A) $6,000; $1,000
B) $4,000; $3,500
C) $5,000; $5,000
D) $1,000; $5,500

Correct Answer:

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