Question 192.5 pointsSave AnswerPrisoner BRemain SilentConfess (do not(cooperate withother prisoner)A gets 2 years, B | A gets 8 years, Bgets 2 yearsA gets 1 year, Bgets 8 yearscooperate withother prisoner)Remain Silent (cooperatewith other prisoner)Confess (do not cooperatewith other prisoner)gets 1 yearA gets 5 years, Bgets 5 yearsPrisoner ATwo prisoners have the option of confessing or remaining silent. The results of their choices are interdependent. Both are trying tominimize their time served in prison. These are the potential outcomes. What is the Nash Equilibrium?Confess, ConfessConfess, Remain SilentRemain Silent, Remain SilentRemain Silent, ConfessO O

Cooperate confess Cooperate 2,2 8, 1 Confess 1,8 5,5

Prisoner B Confess (do not cooperate with other prisoner) A gets 2 years, B | A gets 8 years, B gets 1 year A gets 5 years, B gets 5 years Remain Silent (cooperate with other prisoner) Remain Silent (cooperate with other prisoner) Confess (do not cooperate with other prisoner) gets 2 years A gets 1 year, B gets 8 years Prisoner A Two prisoners have the option of confessing or remaining silent. The results of their choices are interdependent. Both are trying to minimize their time served in prison. These are the potential outcomes. What is the Nash Equilibrium? Confess, Confess Confess, Remain Silent Remain Silent, Remain Silent Remain Silent, Confess O O O

Prisoner B Confess (do not cooperate with other prisoner) A gets 2 years, B | A gets 8 years, B gets 1 year A gets 5 years, B gets 5 years Remain Silent (cooperate with other prisoner) Remain Silent (cooperate with other prisoner) Confess (do not cooperate with other prisoner) gets 2 years A gets 1 year, B gets 8 years Prisoner A Two prisoners have the option of confessing or remaining silent. The results of their choices are interdependent. Both are trying to minimize their time served in prison. These are the potential outcomes. What is the Nash Equilibrium? Confess, Confess Confess, Remain Silent Remain Silent, Remain Silent Remain Silent, Confess O O O

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter8: Market Failure

Section: Chapter Questions

Problem 9P

See similar textbooks

Similar questions

True or false: Discuss if False Homoscedasticity means that E (e^2).
Assume the city of Norman is currently comprised of high productivity workers (MPHP = 80) andlow productivity workers (MPLP = 25). You estimate that 30% are high productivity.(a) Let’s assume every firm had perfect information. If that was the case, what is the market wage?(b) In reality, there is always some asymmetric information. In this case, what would be the marketwage?(c) Now, let’s assume the firm is willing to offer a wage of $80 to anyone with ̄e years of education.Let’s assume the cost for a high productivity work is $5 per year, and the cost for a lowproductivity worker is $11 per year. For what levels of ̄e will each type go to college?(d) What is the separating equilibrium?(e) Now, let’s assume you were wrong about the number of high productivity workers. In reality,50% are considered high productivity workers. How does this impact your answers? Is eachgroup more or less likely to go to college now? Explain.(f) What about if the community actually contained 80% high…
Suppose that an incumbent can commit to producing a large quantity of outputbefore the potential entrant decides whether to enter. So, the incumbent Örst chooseswhether to produce a small quantity or a large quantity. The rival then decides whether toenter. If the incumbent commits to the small output level and if the rival does not enter,the rival makes $0 and the incumbent makes $900. If it does enter, the rival makes $125and the incumbent earns $450. If the incumbent commits to producing the large quantity,and the potential entrant stays out of the market, the potential entrant makes $0 and theincumbent makes $800. If the rival enters, the best the entrant can make is $0, the sameamount it would earn if it didnít enter, but the incumbent earns only $400. Show the gametree. What is the SPNE?
Give typing answer with explanation and conclusion 1. If wH=100 and wL=36 and U(w)=w^1/2. Further, let the reservation utility be 7. (a) What is the minimum probability for which the wage earner accepts the contract? (b)Let p=3/4. What is the maximum cost of effort for which the tenant accepts the contract?
During 2013, 400 people were hired for a particular job. Of the total, 300 were white and 100 were black. There were 1,200 qualified applicants for these jobs, of whom 800 were white and 400 were black. Does adverse impact exist? If adverse impact exists, what does this mean?
2. Maria has $100. There is a 50% that she will lose all of it. Her utility as a functionof wealth is u(c) = √c. a. What is the maximum amount she would be willing to pay to fully insure againstthe 50% probability of the loss? b. Is she risk averse, risk loving, or risk neutral?
Show how education can signal the worker’s innate ability in the labor market. What is a pooled equilibrium? What is a perfectly separating signaling equilibrium?
Give typing answer with explanation and conclusion What does Caroline Criado Perez mean by the term “the default male”?
Look again at Figure 21.12. It appears that the investor in panel b can't lose and the investor in panel a can' t win. Is that correct? Note: The solution should not be hand written.
Using the figures below, construct a complete picture of the vicious circles of economic and politicalpoverty in South Africa or an African country of your choice, and outline the effects upon the poor andupon the state if the situation is not addressed by government and its public bureaucracy. If there is noreversal what would be the implications in respect of the possible collapse of the state through a popularuprising or rebellion. Discuss comprehensively, in terms of learnt theory and your observations. Inaddition to the politicians, is the bureaucracy also to blame? Can this situation be overcome? If so, how?If not, why not.
[Adverse Selection] Each of the two players receives an envelope, in which there is anamount of money that is equally distributed from $0, $1, $2, ..., $100. The amounts in twoenvelopes are independent. After receiving the envelope, each individual can check exactlyhow much money is put in his/her own envelope. Then each player has the option to exchangehis/her envelope for the other individual's prize. The decisions are made simultaneously. Ifboth individuals agree to exchange, then the envelopes are exchanged; otherwise, if at leastone player chooses not to exchange, each individual keeps his/her own envelope and receivesits attached sum of money.a. Model this game as a static Bayesian game (write the normal formrepresentation) and find the Bayesian Nash equilibrium.b. Consider a new game where the probability distribution of money in eachenvelope is changed. The amount is equal to $100 with probability 90%, and is equalto each number in $0, $1, $2, ... ,$99 with probability 0.1%.…
Actual authority is the authoritya partner appears to have to third parties external to the partnership.O. TrueO. False