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This Figure Displays the Choices Being Made by Two Coffee

Question 114

Multiple Choice

  This figure displays the choices being made by two coffee shops: Starbucks and Dunkin Donuts.Both companies are trying to decide whether or not to expand in an area.The area can handle only one of them expanding,and whoever expands will cause the other to lose some business.If they both expand,the market will be saturated,and neither company will do well.The payoffs are the additional profits (or losses) they will earn. The outcome of the game in the figure shown will be: A)  Starbucks will expand and Dunkin Donuts will not. B)  Starbucks will not expand and Dunkin Donuts will. C)  Starbucks and Dunkin Donuts will both expand. D)  neither Starbucks nor Dunkin Donuts will expand. This figure displays the choices being made by two coffee shops: Starbucks and Dunkin Donuts.Both companies are trying to decide whether or not to expand in an area.The area can handle only one of them expanding,and whoever expands will cause the other to lose some business.If they both expand,the market will be saturated,and neither company will do well.The payoffs are the additional profits (or losses) they will earn.
The outcome of the game in the figure shown will be:


A) Starbucks will expand and Dunkin Donuts will not.
B) Starbucks will not expand and Dunkin Donuts will.
C) Starbucks and Dunkin Donuts will both expand.
D) neither Starbucks nor Dunkin Donuts will expand.

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