Question: Two firms, Allied Corporation and Union, Inc., compete primarily by price. Each firm must choose either a high price or a low price simultaneously. The following payoff table shows the profit each firm would earn in each of the four possible decision combinations:

a. Allied’s dominant strategy is ____________ (low price, high price, it has no dominant strategy).

b. Union’s dominant strategy is ____________ (low price, high price, it has no dominant strategy).

c. Allied’s dominated strategy is ________ (low price, high price, it has no dominated strategy).

d. Union’s dominated strategy is ____ (low price, high price, it has no dominated strategy).

e. The likely outcome of this simultaneous pricing decision is for Allied to price _________ (low, high) and for Union to price ________ (low, high).

f. The decision situation facing Allied and Union _____ (is, is not) a prisoners’ dilemma.