Two companies, Acme and Pinnacle, each decide whether to produce a good-quality product or a poor-quality product. In the figure, the dollar amounts are payoffs, and they represent annual profits (in millions of dollars) for the two companies. The dominant strategy for Acme is to

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The question presents a 2-by-2 strategic game between Acme and Pinnacle, where payoffs are profits (in millions) and asks for the dominant strategy for Acme. However, the answer options (the possible choices to select from) are not provided in the data; the field that should contain them is empty. Without the actual payoff matrix or at least the set of possible actions for each firm, we cannot evaluate which strategy dominates for Acme, because determining a dominant strategy requires comparing Acme's payoffs across all possible actions of Pinnacle.

To analyze a dominant strategy in this context, we would normally proceed as follows:
- Step 1: Identify Acme’s possible actions (e.g., produce good quality vs. produce poor quality).
- Step 2: For each of Acme’s actions, compare the payoffs across Pinnacle’s possible actions (e.g., Pinnacle produces good vs. Pinnacle produces poor).
- Step 3: If one of Acme’s actions yields a higher payoff than the other action for every possible action Pinnacle could take, that Acme action is a dominant strategy. If this holds, we would also examine Pinnacle’s payoffs to determine its dominant strategy similarly.

Because the payoff matrix is not shown in the input (the answer options field is empty), we cannot perform these comparisons here. The listed answer text, which claims that Acme should produce a good quality product and that Pinnacle should also produce a good quality product as the dominant strategy, cannot be verified without the actual numbers. If you can provide the payoff matrix or the answer options, I can walk you through the exact comparison step by step and determine the correct dominant strategy(s) with precise reasoning.

In a typical analysis, you would:
- Look at Acme’s row for Acme’s two actions and see if the good-quality payoff is higher than the poor-quality payoff for both Pinnacle’s columns. If so, good quality is Acme’s dominant strategy.
- Similarly, check Pinnacle’s column payoffs to see if their good-quality action dominates their other action, which would indicate Pinnacle’s dominant strategy as well.

Without the matrix, any claim about the dominant strategies remains unsubstantiated.

ECON 1023 (002) Finals Exam

Two companies, Acme and Pinnacle, each decide whether to produce a good-quality product or a poor-quality product. In the figure, the dollar amounts are payoffs, and they represent annual profits (in millions of dollars) for the two companies. The dominant strategy for Acme is to

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