Which of the following,according to Nash's theorem,is a property of the unique solution obtained?
A) Unique point maximizes the geometric average of the gains available to people as measured against their reservation points.
B) The agreement point, u, of a negotiation will not satisfy the independence of irrelevant alternatives axiom.
C) The bargaining process might yield outcomes that both people find less desirable than some other feasible outcome.
D) The Pareto-optimality and symmetry axioms are not used to define the agreement points of a symmetrical game.

Question

Quizplus · Accepted Answer

According to Nash's theorem, the unique solution obtained maximizes the product of gains available to people, as measured against their reservation points. This is equivalent to maximizing the geometric average of the gains. Therefore, option A is the correct answer. Option B is incorrect, as the unique solution obtained satisfies the independence of irrelevant alternatives axiom. Option C is also incorrect, as the unique solution obtained is Pareto-optimal, meaning no other feasible outcome can make both parties better off. Option D is incorrect, as the Pareto-optimality and symmetry axioms are indeed used to define the agreement points of a symmetrical game.

Which of the Following,according to Nash's Theorem,is a Property of the Unique