The following matrix represents the payoffs to two producers, each making a strategic choice either to keep the output at 5 units or at 10 units.

-Refer to Table 7-1.Which of the following output combinations represents the dominant strategy of the two players?
A)Each player produces 5 units of output.
B)Player A produces 5 units and Player B produces 10 units.
C)Player A produces 10 units and Player B produces 5 units.
D)Each player produces 10 units of output.

Question

The following matrix represents the payoffs to two producers, each making a strategic choice either to keep the output at 5 units or at 10 units.

-Refer to Table 7-1.Which of the following output combinations represents the dominant strategy of the two players?
A)Each player produces 5 units of output. 
B)Player A produces 5 units and Player B produces 10 units. 
C)Player A produces 10 units and Player B produces 5 units. 
D)Each player produces 10 units of output.

Quizplus · Accepted Answer

A dominant strategy is a strategy that is the best for a player regardless of what the other player chooses. In this case, each player's dominant strategy is to produce 10 units of output as it offers the highest payoff of 20 for each player, regardless of the other player's choice. Therefore, the best choice for both players is to produce 10 units of output.

The Following Matrix Represents the Payoffs to Two Producers, Each