-Consider the advertising game depicted in Figure 1.6 in which payoffs are in thousands of dollars. If larger payoffs are preferred, this is an example of a:
I. Game in which both players have a strictly dominant strategy.
II. Prisoner's dilemma.
III. Two-player, noncooperative, static game.
Which of the following is correct?
A) I only.
B) II only.
C) III only.
D) II and III only.
E) I, II, and III.

Question

-Consider the advertising game depicted in Figure 1.6 in which payoffs are in thousands of dollars. If larger payoffs are preferred, this is an example of a:
I. Game in which both players have a strictly dominant strategy.
II. Prisoner's dilemma.
III. Two-player, noncooperative, static game.
Which of the following is correct?
A) I only. 
B) II only. 
C) III only. 
D) II and III only. 
E) I, II, and III.

Quizplus · Accepted Answer

This scenario is both a Prisoner's Dilemma and a two-player, noncooperative, static game. In a Prisoner's Dilemma, each player has a dominant strategy that leads to a suboptimal outcome for both when followed. It's also a two-player, noncooperative, static game because the players make their decisions simultaneously without cooperation, and the game does not evolve over time. However, without seeing Figure 1.6, it's impossible to confirm if both players have a strictly dominant strategy, but the description suggests a typical Prisoner's Dilemma structure.

-Consider the Advertising Game Depicted in Figure 1