Table 61 Hypothetical Profit Matrix for Boeing and Airbus
(millions

Table 6.1 Hypothetical Profit Matrix for Boeing and Airbus
(millions of dollars in profits for high-price and low-price strategies)
$\begin{array}{llcc}&&& \text { Boeing }&\\ \text { } & \text { } & \text {High price } & \text {} &\text { Low price } \\ \text { } & \text { High price } & \text { Airbus \( =\$ 500 \) } & \text { } &\text {Airbus \( =\$ 650 \) } \\ \text {Airbus } & \text { } & \text { Boeing \( =\$ 500 \) } & \text { } &\text { Boeing \( =\$ 400 \) } \\ \text { } & \text { } & \text { } & \text { } & \text { } \\ \text { } & \text {Low price } & \text { Airbus \( =\$ 400 \) } & \text { } & \text { Airbus \( =\$ 350 \) } \\ \text { } & \text { } & \text { Boeing \( =\$ 650 \) } & \text { } &\text { Boeing \( =\$ 350 \) } \\\end{array}$


-Refer to Table 6.1. If Boeing and Airbus form a collusive pact to maximize joint profits, the firms will realize profits totaling

A) $700 million
B) $900 million
C) $1,000 million
D) $1,050 million

Correct Answer:

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