The Nash equilibrium for a game can be a sub-optimal outcome for players when:
A)defection is likely to be individually rational
B)self-interest is likely to be individually irrational
C)defection is likely to be collectively rational
D)self-interest is likely to be collectively irrational

Question

Quizplus · Accepted Answer

In a Nash equilibrium, each player's strategy is optimal given the strategies of others. However, this can lead to sub-optimal outcomes for all players if defection (acting in self-interest) is individually rational but leads to a worse collective outcome, such as in the Prisoner's Dilemma.

The Nash Equilibrium for a Game Can Be a Sub-Optimal