The prisoners' dilemma game a. is a situation in which two players both have dominant strategies which lead to the highest total payoff for the two players. b. has no Nash equilibrium since players, after agreeing to play their dominant strategy, will have an incentive to switch to another strategy. c. has a Nash equilibrium, but the Nash equilibrium outcome is not the outcome the players would agree to if they could cooperate with each other. d. Both a and c are correct.

Question

Pierre Lynch

Business

23 October, 10:37

The prisoners' dilemma game a. is a situation in which two players both have dominant strategies which lead to the highest total payoff for the two players. b. has no Nash equilibrium since players, after agreeing to play their dominant strategy, will have an incentive to switch to another strategy. c. has a Nash equilibrium, but the Nash equilibrium outcome is not the outcome the players would agree to if they could cooperate with each other. d. Both a and c are correct.

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Answers (1)

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Bailee · Answer 1

The correct answer is option c.

Explanation:

Prisoner's dilemma is a common concept in the game theory. It shows why two rational individuals will not cooperate. Two prisoner's have the choice to cooperate with each other and remain silent or blame the other.

The Nash equilibrium for both the payers here will be to betray each other. But this will incur cost on both of them. If the players could cooperate with each other, they would not agree to this.