A prisoner's dilemma equilibrium is:
A)identical to the monopolistically competitive equilibrium.
B)a Nash equilibrium.
C)not a dominant-strategy equilibrium.
D)the same as the perfectly competitive equilibrium.

Question

Quizplus · Accepted Answer

A prisoner's dilemma equilibrium is a Nash equilibrium, where neither player can improve their payoff by unilaterally deviating from their current strategy. It is not a dominant-strategy equilibrium because each player's best strategy depends on the other player's strategy. It is not the same as a perfectly competitive equilibrium because in a prisoner's dilemma, cooperation would lead to the best outcome, but self-interest leads to both players defecting and receiving a suboptimal outcome. Monopolistically competitive equilibrium is not related to the prisoner's dilemma.

A Prisoner's Dilemma Equilibrium Is