300 Refer to Table 12-1. To maximize its profit, how many w 42. b. 2 workers wil

Question

300 Refer to Table 12-1. To maximize its profit, how many w 42. b. 2 workers will the firm hire Martha and Don are competitors in a local market and each i trying to decide if it is worthwhile to advertisc If both of them advertise, each will earn a profit of $5000. If neither of them advertises, each will earn of $10 000. and the other will earn $7000. What is Martha's dominant trategy? a. She should advertise, and she will earn $5000. h. She should not advertise, and she will earn $10 000 If one advertises and the other doesn't, then the one who advertises will earn a profit of $15 000 c. Martha has no strategy that guarantees her the most money d. She should advertise, and she will earn $15 000. The marginal-cost curve The avera xed-cost curve d. the b 0.68

Explanation / Answer

Both are competitors in local market and each of them want to earn maximum. If Martha will advertise she will earn $15000 and people came to know about her. It would be beneficial to advertise for future.

So, answer is option (d)

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