If the above payoff matrix is a simultaneous-move production game, the Nash equilibrium is for
A)both players to produce low output.
B)both players to produce high output.
C)play 1 to produce low output and player 2 to produce high output.
D)play 1 to produce high output and player 2 to produce low output.

Question

Quizplus · Accepted Answer

The Nash equilibrium is for both players to produce low output because this is the only outcome where neither player can improve their payoff by changing their strategy.

If the Above Payoff Matrix Is a Simultaneous-Move Production Game