If the payoff to the United States to pursuing nuclear weapons is 100 if the USSR does not pursue nuclear weapons and 50 if the USSR does, and the payoff to the USSR to pursuing nuclear weapons is 80 if the USA doesn't pursue nuclear weapons and 30
if the USA does, what is the non-cooperative equilibrium? A) The USA pursues nuclear weapons, the USSR does not.
B) The USA pursues nuclear weapons, the USSR pursues nuclear weapons.
C) The USA does not pursue nuclear weapons, the USSR does not pursue nuclear weapons.
D) The USA does not pursue nuclear weapons, the USSR does pursue nuclear weapons.
B
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When we export goods to foreign countries, we
A) receive payments from the rest of the world. B) make payments to the rest of the world. C) increase our inflation rate. D) decrease our inflation rate.
The efficiency case made for free trade is that as trade distortions such as tariffs are dismantled and removed
A) government tariff revenue will decrease, and therefore national economic welfare will decrease. B) government tariff revenue will decrease, and therefore national economic welfare will increase. C) deadweight losses for producers and consumers will decrease, hence increasing national economic welfare. D) deadweight losses for producers and consumers will decrease, hence decreasing national economic welfare. E) government tariff revenue will increase, hence increasing national economic welfare.
In order to achieve social efficiency, the size of an effluent tax should be based on:
a. the external cost created by the pollutant. b. people's willingness to pay for a cleaner environment. c. the expense of installing new "green" equipment. d. the number of free riders in the industry.
Which of the following might lead a nation to engage in international trade? a. Differences in natural endowments such as climate. b. Differences in skills of the labor force
c. Differences in endowments of natural resources. d. All of the above.