Given the Payoff Matrix in Table 25

Multiple Choice

$$\begin{array}{l}\begin{array} { | l | l | l | } \hline & { \text { Company XYZ's Possible Responses } } \\\hline \text { Company ABC's Action } & \text { Charge High Prices } & \text { Charge Low Prices } \\\hline \text { Charge high prices } & \text { Profit gain loss } = \$ 0 & \text { Profit loss } = \$ 5,000 \\\hline \text { Charge low prices } & \text { Profit gain } = \$ 50,000 & \text { Profit loss } = \$ 500 \\\hline\end{array}\\\text { Table } 25.1\end{array}$$ Given the payoff matrix in Table 25.1, if the probability of rivals reducing their price even though you don't is 10 percent, what is the expected payoff for Company ABC not cutting prices?

A) $0.
B) $5.
C) -$500.
D) -$5,000.