The solution in the prisoner's dilemma is called the
a. loss minimizing solution
b. profit maximizing equilibrium
c. dominant-strategy equilibrium
d. revenue maximizing equilibrium
e. marginal revenue solution
C
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Suppose that GDP is equal to 1000, national saving is equal to 200, the current account deficit is equal to 100, and the government budget deficit is equal to 50. Private savings must equal
A) 150. B) 200. C) 250. D) 300.
The price charged by a monopolist is socially inefficient because the price
A) exceeds the true marginal cost of the resources used. B) is less than the opportunity cost of the resources used. C) puts the monopolist into a higher tax bracket. D) is too low.
A fallacy of composition is to assume that
a. you can determine the composition of a complex product just by examining its exterior properties b. consumer durable goods today do not last as long as they did a generation ago c. any mistakes made in producing a product using an assembly line technique will lead to a compounding of errors as the product moves down the line d. what is true for any individual component in a group is true for the group as a whole e. when I was young I liked cotton candy, but now that I'm older I no longer like it
Suppose Dean and Kennedy are playing a single stage game. Each simultaneously chooses either 1 or 2. If they both select 1, Dean pays Kennedy $2. If they both pick 2, Dean pays Kennedy $4. If they select different numbers, Kennedy pays Dean $3. Draw a table showing the two players' strategies and payoffs. Are any strategies dominant? Weakly dominant? Dominated? Solve for a mixed strategy equilibrium.
The payoff matrix should appear as follows:
What will be an ideal response?