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malfutka [58]
3 years ago
8

Two oligopolists have to decide on their pricing strategy. Each can choose either a high or a low price. If they both choose a h

igh​ price, each will make​ $12 million, but if they both choose a low​ price, each will make only​ $8 million. If one sets a high price and the other a low​ one, the​ low-priced firm will make​ $16 million, but the​ high-priced firm will make only​ $4 million.
In the absence of​ collusion, each will _________.
Business
1 answer:
yulyashka [42]3 years ago
5 0

Answer:

<h2>Considering absence of collusion,the firms will choose low price in this instance.</h2>

Explanation:

  • First,focusing on all the possible payoffs for the firms under low price situation, the possible individual payoffs for the firms are $8 million and $16 million considering that the other firm chooses low price and high price respectively.
  • Now, regarding the individual payoffs from choosing high price, the possible payoffs for the firms are $12 million and $4 million, considering that the other firm chooses high price and low price respectively.
  • Therefore, notice that considering all possible scenarios,both the minimum and maximum payoffs from choosing low price are actually higher than the same estimates under choosing higher price.
  • Hence, to ensure a higher subsequent individual payoff, both the firms would expectedly choose lower price considering the possibilities of both higher minimum and maximum payoff compared to choosing higher price.
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<u>Solution and Explanation:</u>

The following would be the specifications of the training module for the cashiers:

1. There would be multiple modules consisting of the job responsibilities as refresher courses and at the same time, the new market conditions and additional job related things that they must be doing in the near future would be the other modules.

2. The key areas that the multi module training program would be focussing on would be, customer relationship training, system and data maintenance training, documentation and accounting module

3. The training intervention would be preferably on job and alongside there would be a mentor/coach allotted to the cashiers who are experts in the field preferably store managers and functional experts. For the system related modules, they would be having simulation based modules. Only during the non rush-hours there would be offline training and update sessions with respect to the progress made on their training and the productivity improvement they have achieved over the past week.

The incentives associated with the productivity improvement would be translated into incentivising the cashiers to take up the training modules. The weekly update on the productivity improvement and the progress in their training would inturn make them competitive in nature. While coming to why such distribution has been done with respect to the modules, essentially if we look at the job of the cashiers, it’s a round the clock job and they would lose out on precious working hours if the training is done on an offline basis.

The simulations would definitely help understand the process but the on job training would be the one that is standing out, as they would be continuing their task and at the same time, the result is right in front on them to experience and therefore the distribution of the modules to not stress them out and at the same time not losing out on their time as well.

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Answer:

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Expansionary monetary​ policies are geared towards stimulating economic growth. The Fed can impose lower interest rates or purchase bonds and securities in open market operations as expansionary tools. Lowering interest rates encourages banks and other lending institutions to lend money to firms and households.  

Purchasing bonds and securities adds money to the banking system. The increased money will be loaned out to businesses and individuals. The availability of low-cost credit motivates firms to borrow and expands their business capacities. When households borrow with ease, it leads to an increase in consumption expenditure.  These actions result in too much money in circulation, which is inflation.

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