Multiple Choice
Refer to the normal-form game of price competition shown below. 
Firm A must decide whether or not to introduce a new product. If firm A introduces a new product, firm B must decide whether or not to clone the product. The payoff structure of the game is depicted in Figure 10-12. The subgame perfect Nash equilibrium to this game is:
A) Firm A plays "Introduce"; firm B plays "Clone" if firm A plays "Introduce."
B) Firm A plays "Do Not Introduce"; firm B plays "Clone" if firm A plays "Introduce."
C) Firm A plays "Introduce"; firm B plays "Do Not Clone" if firm A plays "Introduce."
D) Firm A plays "Do Not Introduce"; firm B plays "Do Not Clone" if firm A plays "Introduce."
Correct Answer:
Verified
Correct Answer:
Verified
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