Mexico and OPEC both produce crude oil.Realizing that it would be in their best interest to form an agreement on production goals,a meeting is arranged and an informal,verbal agreement is reached.If both Mexico and OPEC stick to the agreement,OPEC will earn profit of $200 million and Mexico will earn profit of $100 million.If both Mexico and OPEC cheat,then OPEC will earn $175 million and Mexico will earn $80 million.If only OPEC cheats,then OPEC earns $185 million and Mexico $60 million.If only Mexico cheats,then Mexico earns $110 million and OPEC $150 million.
-Refer to the information given above.This game would __________ because __________.
A) be a prisoner's dilemma;not cheating is better for both
B) not be a prisoner's dilemma;cheating is better for both
C) be a prisoner's dilemma;cheating is better for both
D) be a prisoner's dilemma;Mexico has a dominant strategy
E) not be a prisoner's dilemma;OPEC does not have a dominant strategy

Question

Mexico and OPEC both produce crude oil.Realizing that it would be in their best interest to form an agreement on production goals,a meeting is arranged and an informal,verbal agreement is reached.If both Mexico and OPEC stick to the agreement,OPEC will earn profit of $200 million and Mexico will earn profit of $100 million.If both Mexico and OPEC cheat,then OPEC will earn $175 million and Mexico will earn $80 million.If only OPEC cheats,then OPEC earns $185 million and Mexico $60 million.If only Mexico cheats,then Mexico earns $110 million and OPEC $150 million. 
-Refer to the information given above.This game would __________ because __________.
A) be a prisoner's dilemma;not cheating is better for both 
B) not be a prisoner's dilemma;cheating is better for both 
C) be a prisoner's dilemma;cheating is better for both 
D) be a prisoner's dilemma;Mexico has a dominant strategy 
E) not be a prisoner's dilemma;OPEC does not have a dominant strategy

Quizplus · Accepted Answer

The Answer of Mexico and OPEC both produce crude oil.Realizing that it would be in their best interest to form an agreement on production goals,a meeting is arranged and an informal,verbal agreement is reached.If both Mexico and OPEC stick to the agreement,OPEC will earn profit of $200 million and Mexico will earn profit of $100 million.If both Mexico and OPEC cheat,then OPEC will earn $175 million and Mexico will earn $80 million.If only OPEC cheats,then OPEC earns $185 million and Mexico $60 million.If only Mexico cheats,then Mexico earns $110 million and OPEC $150 million. 
-Refer to the information given above.This game would __________ because __________.
A) be a prisoner's dilemma;not cheating is better for both 
B) not be a prisoner's dilemma;cheating is better for both 
C) be a prisoner's dilemma;cheating is better for both 
D) be a prisoner's dilemma;Mexico has a dominant strategy 
E) not be a prisoner's dilemma;OPEC does not have a dominant strategy

Mexico and OPEC Both Produce Crude Oil