Consider the accompanying payoff matrix. If Row Resorts offers reduced rates, then Column Cruises would receive the highest payoff if it:
A)kept its rates high.
B)offered reduced its rates.
C)entered into a cartel with Row Resorts and agreed to jointly reduce rates.
D)choose either strategy because it will have the same payoff in either case.

Question

Consider the accompanying payoff matrix.  If Row Resorts offers reduced rates, then Column Cruises would receive the highest payoff if it:
A)kept its rates high. 
B)offered reduced its rates. 
C)entered into a cartel with Row Resorts and agreed to jointly reduce rates. 
D)choose either strategy because it will have the same payoff in either case.

Quizplus · Accepted Answer

If Row Resorts offers reduced rates, then Column Cruises will earn 50 if it offers reduced rates and 10 if it keeps its rates high.

Consider the Accompanying Payoff Matrix