Intel and AMD are a duopoly that produces CPU chips. Intel and AMD can conduct R&D or they cannot conduct R&D. The table above shows the payoff matrix for the two firms
If AMD is playing a tit-for-tat strategy, then if Intel conducted R&D last period, AMD A) definitely conducts R&D this period.
B) definitely does not conduct R&D this period.
C) might conduct R&D or might not conduct R&D, depending on Intel's profit.
D) might conduct R&D or might not conduct R&D, depending on its profit.
E) might conduct R&D or might not conduct R&D, but more information is needed to determine its action.
A
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The ABC Nail Company has entered into a collusive agreement with the other firm in the industry, the DC Nail Company. What occurs in the nail industry if ABC decides to cheat on the agreement?
A) ABC lowers the price of its nails. B) The total industry output increases. C) The total profits in the nail industry will decrease. D) All of the above answers are correct.
The rate of product transformation (RPT) measures the ability of:
a. a consumer to trade one good for another while still maximizing his or her utility. b. a firm to substitute one input for another and still maintain the same production level. c. society to substitute the production of one good for another while still using a fixed supply of inputs efficiently. d. a firm to produce a final good while starting with only natural resources.