-The above figure shows the payoff to two airlines,A and B,of serving a particular route.If the two airlines must decide simultaneously,and the government imposes a $20 per firm tax on firms that service this route,which of the following maximizes the firms' joint profits?
A) Neither firm services the route.
B) Firm A offers firm B $20 to not enter.
C) Both firms will service this route.
D) Firm B offers firm A $30 to not enter.

Question

-The above figure shows the payoff to two airlines,A and B,of serving a particular route.If the two airlines must decide simultaneously,and the government imposes a $20 per firm tax on firms that service this route,which of the following maximizes the firms' joint profits?
A) Neither firm services the route. 
B) Firm A offers firm B $20 to not enter. 
C) Both firms will service this route. 
D) Firm B offers firm A $30 to not enter.

Quizplus · Accepted Answer

The Answer of 
-The above figure shows the payoff to two airlines,A and B,of serving a particular route.If the two airlines must decide simultaneously,and the government imposes a $20 per firm tax on firms that service this route,which of the following maximizes the firms' joint profits?
A) Neither firm services the route. 
B) Firm A offers firm B $20 to not enter. 
C) Both firms will service this route. 
D) Firm B offers firm A $30 to not enter.

-The Above Figure Shows the Payoff to Two Airlines,A and B,of