This prisoner's dilemma game shows the payoffs associated with two firms,A and B,in an oligopoly and their choices to either collude with one another or not.
Given the situation in the matrix shown,we can predict that Firm A's profits will be:

Question

This prisoner's dilemma game shows the payoffs associated with two firms,A and B,in an oligopoly and their choices to either collude with one another or not. 
Given the situation in the matrix shown,we can predict that Firm A's profits will be:

Quizplus · Accepted Answer

The best choice for Firm A is to collude with Firm B, which will result in a profit of $100 million for Firm A. If both firms collude, they can earn $450 million collectively. However, if Firm A chooses to not collude while Firm B does, then Firm A will only earn $50 million. If both firms choose to not collude, they will earn $200 million collectively, but Firm A's profit will only be $75 million. Therefore, the best choice for Firm A is to collude.

This Prisoner's Dilemma Game Shows the Payoffs Associated with Two