-Consider the pricing game depicted in Figure 4.1 in which the payoffs are in millions of dollars. If the discount rate is 20 percent and this game is infinitely repeated, what is the present value of the stream of payoffs by cooperating?
A) $24 million.
B) $34 million.
C) $52 million.
D) $60 million.
E) None of the above.

Question

-Consider the pricing game depicted in Figure 4.1 in which the payoffs are in millions of dollars. If the discount rate is 20 percent and this game is infinitely repeated, what is the present value of the stream of payoffs by cooperating?
A) $24 million. 
B) $34 million. 
C) $52 million. 
D) $60 million. 
E) None of the above.

Quizplus · Accepted Answer

The Answer of 
-Consider the pricing game depicted in Figure 4.1 in which the payoffs are in millions of dollars. If the discount rate is 20 percent and this game is infinitely repeated, what is the present value of the stream of payoffs by cooperating?
A) $24 million. 
B) $34 million. 
C) $52 million. 
D) $60 million. 
E) None of the above.

-Consider the Pricing Game Depicted in Figure 4