Shel and Fran are neighbors.They work at the same firm and hold the same title.Shel finds that when Fran's consumption rises,Shel feels worse off.Fran feels the same way towards Shel's consumption.
Refer to the information given above.Suppose that the firm that employs both Fran and Shel began offering an hour of overtime at 1.5 times their base hourly wage and that both Fran and Shel worked the additional hour.A few weeks later the firm began offering a second hour of overtime at 1.5 times their base hourly wage and that both Fran and Shel worked that second additional hour.An effective mechanism to avoid working all day and all night as their employer offers more and more overtime,Fran and Shel could:
A)stop independently.
B)not let the other's consumption affect them.
C)lobby for limits on the maximum number of hours in a work week.
D)agree between them to stop this silly game.

Question

Quizplus · Accepted Answer

Fran and Shel do not have any independent incentive to stop the escalation so they should seek an outside force to remove the ability to engage in this positional arms race.

Shel and Fran Are Neighbors