The Market for Bagels in Charlottetown,PEI Contains Two Firms: BagelWorld

Multiple Choice

The market for bagels in Charlottetown,PEI contains two firms: BagelWorld (BW) and Bagels'R'Us (BRU) .The owners of the two firms decide to fix the price of bagels.The table shows the total revenue the firms will collect if they abide by the price-setting agreement or if they cheat on the agreement.
-Based on the payoff matrix above,Bagel World finds that __________ is its __________.

A) abiding by the agreement;dominant strategy
B) cheating on the agreement;dominated strategy
C) either cheating or abiding;dominant strategy
D) cheating on the agreement;dominant strategy
E) either cheating or abiding;dominated strategy