Consider the following payoff matrix facing two criminals. A: ConfessA: Not ConfessB: ConfessA: 20yrs, B: 20yrsA: 50yrs, B: 2yrsB: Not ConfessA: 2yrs, B: 50yrsA: 10yrs, B: 10yrsTheir options are to confess or not to confess. Given this information:
A. A has a dominant strategy but B does not.
B. B has a dominant strategy but A does not.
C. both A and B have dominant strategies.
D. neither A nor B has a dominant strategy.
Answer: C
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Which of the following best explains why garbage collectors are paid a higher wage than many others with comparable skills?
a. because of the dangers associated with collecting trash b. because garbage collectors work much longer hours on average than do those in other jobs c. because of the unpleasantness associated with trash collection d. because garbage collectors possess skills that are in relatively high demand
The former communist countries of eastern Europe and the Soviet Union
a. have a better track record in environment protection than market economies. b. have a dismal environmental record. c. epitomize the ability of planned economies to protect the environment. d. have no water pollution problems.
Lewis has $5,000 worth of bonds in Farrell’s Seed Company. Bonnie has 10,000 shares of preferred stock in the company, Jeff has 100,000 shares of common stock, and Val has 1 share of common stock. If Farrell’s Seed Company goes out of business, which obligation will it be required to meet first?
a. paying Bonnie the full value of her preferred stock b. paying Jeff the dividends on his common stock c. paying Lewis the full value of his bonds d. paying Val the full value for her share of common stock
Transaction costs are
A. not true costs since they are often not paid. B. the costs associated with making a transaction that is required by the government. C. the costs associated with making, reaching and enforcing agreements. D. the costs associated with exchanges in the service area.