Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN: 9781305506381
Author: James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher: Cengage Learning
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Chapter 13, Problem 4E
To determine
To Ascertain:
Based on the given situation and the conditions given, propose the actions and also whether to match rates or cut rates.
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You and a classmate are assigned a project on which you will receive one combined grade. You each want to receive a good grade, but you also want to avoid hard work. In particular, here is the situation:
•
If both of you work hard, you both get an A, which gives each of you 40 units of happiness.
•
If only one of you works hard, you both get a B, which gives each of you 30 units of happiness.
•
If neither of you works hard, you both get a D, which gives each of you 10 units of happiness.
•
Working hard costs 25 units of happiness.
Complete the following payoff matrix given the previous information. In each cell, your classmate's payoff is on the left and yours is on the right.
Your Decision
Work
Shirk
Classmate's Decision
Work
,
,
Shirk
,
,
The likely outcome is that your classmate and you .
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Chapter 13 Solutions
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
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