-The table above shows the payoff matrix offered to two suspected criminals, Bonnie and Clyde. The payoffs are the years they will spend in prison. The suspected criminals are not allowed to communicate. Which of the following statements correctly describes the equilibrium choices made by Bonnie and Clyde?

Question

Quizplus · Accepted Answer

The Nash equilibrium occurs when each player's strategy is optimal given the other player's strategy. In many games, including typical prisoner's dilemma scenarios like the one implied here, if the players could communicate and trust each other, they could often agree on a strategy that would result in a better outcome for both (e.g., both denying the crime) compared to the Nash equilibrium (often both confessing). However, without communication and the ability to enforce agreements, each player's fear that the other will betray them leads to both choosing the strategy that is individually rational given the strategies available to the other, which is typically not the best collective outcome.

-The Table Above Shows the Payoff Matrix Offered to Two