the answer IS NOT A) Suppose two firms, Allstom from France, and Bombardier from Canada, are bidding on a contract to replace train cars for the subwaysystem in Mexico City. If they bid the same amount, they share the contract, otherwise, the low bid wins. The figure below shows thepayoff matrix for this contest.Bombardier (B)B bids$60 millionB bids$40 millionA bids$60 millionProfit to A: $12 mProfit to B: $12 mProfit to A: $0 mProfit to B: $6 mAllstom (A)CA bids$40 millionProfit to A: $6 mProfit to B: $0 mProfit to A: $3 mProfit to B: $3 mO A. each firm bids $40 million, and earns profit of $3 million.B. each firm bids $60 million, and earns profit of $12 million.O C. Bombardier bids $40 million, and earns profit of $6 million, while Allstom bids $60 million and earns profit of $0.O D. Bombardier bids $60 million, and earns profit of $0, while Allstom bids $40 million and earns profit of $6 million.

Game theory studies the interactions and decisions of multiple individuals or groups, called…

Suppose two firms, Allstom from France, and Bombardier from Canada, are bidding on a contract to replace train cars for the subway system in Mexico City. If they bid the same amount, they share the contract, otherwise, the low bid wins. The figure below shows the payoff matrix for this contest. Bombardier (B) B bids $60 million B bids $40 million A bids $60 million Profit to A: $12 m Profit to B: $12 m Profit to A: $0 m Profit to B: $6 m Allstom (A) ... A bids $40 million Profit to A: $6 m Profit to B: $0 m Profit to A: $3 m Profit to B: $3 m O A. each firm bids $40 million, and earns profit of $3 million. O B. each firm bids $60 million, and earns profit of $12 million. O C. Bombardier bids $40 million, and earns profit of $6 million, while Allstom bids $60 million and earns profit of $0. O D. Bombardier bids $60 million, and earns profit of $0, while Allstom bids $40 million and earns profit of $6 million.

Suppose two firms, Allstom from France, and Bombardier from Canada, are bidding on a contract to replace train cars for the subway system in Mexico City. If they bid the same amount, they share the contract, otherwise, the low bid wins. The figure below shows the payoff matrix for this contest. Bombardier (B) B bids $60 million B bids $40 million A bids $60 million Profit to A: $12 m Profit to B: $12 m Profit to A: $0 m Profit to B: $6 m Allstom (A) ... A bids $40 million Profit to A: $6 m Profit to B: $0 m Profit to A: $3 m Profit to B: $3 m O A. each firm bids $40 million, and earns profit of $3 million. O B. each firm bids $60 million, and earns profit of $12 million. O C. Bombardier bids $40 million, and earns profit of $6 million, while Allstom bids $60 million and earns profit of $0. O D. Bombardier bids $60 million, and earns profit of $0, while Allstom bids $40 million and earns profit of $6 million.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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