According to the figure shown:
This figure shows the payoffs involved when Sarah and Joe work on a school project together for a single grade. They both will enjoy a higher grade when more effort is put into the project, but they also get pleasure from goofing off and not working on the project. The payoffs can be thought of as the utility each would get from the effort they individually put forth and the grade they jointly receive.
A. there is no stable equilibrium to the game.
B. both will act in their own self-interest and get a stable, but less than optimum, equilibrium.
C. both will act in their own self-interest and get an optimum equilibrium that is stable.
D. both have incentive to put forth high effort.
B. both will act in their own self-interest and get a stable, but less than optimum, equilibrium.
You might also like to view...
A monopsonist is currently employing 50 workers at $10 an hour. It wants to hire an additional worker, but will have to pay the worker $10.10. The marginal factor cost is
A) ten cents. B) $10.00. C) $10.10. D) $15.10.
Economics assumes that human behavior reflects "rational self-interest." This means they allocate their time, energy, and money to maximize their satisfaction.
a. true b. false
Suppose the nominal interest rate in Brazil is 40 percent and the expected inflation rate is 150 percent. The real interest rate is:
A. 1-90 percent. B. 190 percent. C. 1-10 percent. D. 110 percent.
The three legs of the organizational stool are reward systems, performance-evaluation systems, and
A. communication. B. market structure. C. decision rights. D. sunkcosts.