CineA and ViewB are the only 2 cinemas operating in Brisbane. They have large market power...

 

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CineA and ViewB are the only 2 cinemas operating in Brisbane. They have large market power in the cinema market and can make decisions on movie ticket pricing. They often are at a competition to gain a larger market share. Answer the following questions: a. In this type of market, would CineA be able to maximise profits by setting marginal benefits = equals marginal costs, which is the common rule used for a firm in a perfectly competitive market? N Type Y for Yes or N for No. b. A new movie is about to be released in theatres. CineA and ViewB are trying to work out their pricing strategy. They could either charge a low price for their tickets, or a high one. The expected payoff will depend much on the other cinema's decision. The payoff matrix (with payoffs represented in thousand of dollars, CineA being the left player and ViewB being the player on the top row) is shown below. What pricing strategy should CineA make? L Type L for Low or H for High. Low High Low 34, 31 15, 80 c. Does this game satisfy the criteria for a Prisoner's Dilemma? Y d. Is there the potential for consumers and customers to benefit from this outcome? Yes or N for No. High 79, 14 54, 52 Type Y for Yes or N for No. . Type Y for CineA and ViewB are the only 2 cinemas operating in Brisbane. They have large market power in the cinema market and can make decisions on movie ticket pricing. They often are at a competition to gain a larger market share. Answer the following questions: a. In this type of market, would CineA be able to maximise profits by setting marginal benefits = equals marginal costs, which is the common rule used for a firm in a perfectly competitive market? N Type Y for Yes or N for No. b. A new movie is about to be released in theatres. CineA and ViewB are trying to work out their pricing strategy. They could either charge a low price for their tickets, or a high one. The expected payoff will depend much on the other cinema's decision. The payoff matrix (with payoffs represented in thousand of dollars, CineA being the left player and ViewB being the player on the top row) is shown below. What pricing strategy should CineA make? L Type L for Low or H for High. Low High Low 34, 31 15, 80 c. Does this game satisfy the criteria for a Prisoner's Dilemma? Y d. Is there the potential for consumers and customers to benefit from this outcome? Yes or N for No. High 79, 14 54, 52 Type Y for Yes or N for No. . Type Y for

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answer He only has two cinemas operating in Brisbane Cine A and View B They have significant market power in the movie market and can determine the pr... View the full answer