Suppose Firm A and Firm B are considering whether to invest in a new production technology. For each firm, the payoff to investing (given in thousands of dollars per day) depends upon whether the other firm invests, as shown in the payoff matrix below. Is this game a prisoner's dilemma?
A)Yes.
B)No.
C)It cannot be determined.
D)Only when both Firm A and Firm B invest.

Question

Suppose Firm A and Firm B are considering whether to invest in a new production technology. For each firm, the payoff to investing (given in thousands of dollars per day) depends upon whether the other firm invests, as shown in the payoff matrix below.  Is this game a prisoner's dilemma?
A)Yes. 
B)No. 
C)It cannot be determined. 
D)Only when both Firm A and Firm B invest.

Quizplus · Accepted Answer

The Answer of Suppose Firm A and Firm B are considering whether to invest in a new production technology. For each firm, the payoff to investing (given in thousands of dollars per day) depends upon whether the other firm invests, as shown in the payoff matrix below.  Is this game a prisoner's dilemma?
A)Yes. 
B)No. 
C)It cannot be determined. 
D)Only when both Firm A and Firm B invest.

Suppose Firm a and Firm B Are Considering Whether to Invest