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Collusive agreements can be established and maintained by: a. Credible threats. b. One-t

Collusive agreements can be established and maintained by: a. Credible threats. b. One-t

 Collusive agreements can be established and maintained by:

a. Credible threats.
b. One-time games.
c. Empty threats.
d. First-mover advantage.

2. True or false.  Potential rivals may be more likely to collude if they view themselves as playing a repeated game rather than a one-time game.

3. Property developers who build shopping malls like to have them “anchored” with the outlets of one or more famous national retail chains, like Target or Nordstrom.  Having such “anchors” is obviously good for the mall developers because anchor stores bring in a lot of foot traffic that can help generate sales for smaller stores that lack well-known national brands.  But what’s in it for the national retail chains?  Why become an anchor?  Choose the best answer from the following list.

a. The anchor stores want to make a credible threat against the developer.
b. The anchor stores may feel there is a first-mover advantage to becoming one of only a few anchor stores at a new mall.
c. The property developers are making empty threats to smaller stores.
d. The smaller stores face a negative-sum game.

Abhinav 05-Dec-2019

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