Scenario 13.9 Consider the Following Game

question 126

Multiple Choice

Scenario 13.9
Consider the following game:
Two firms are situated next to a lake, and it costs each firm $1,500 per period to use filters that avoid polluting the lake. However, each firm must use the lake's water in production, so it is also costly to have a polluted lake. The cost to each firm of dealing with water from a polluted lake is $1,000 times the number of polluting firms.
-A "mixed strategy" equilibrium means that:

• A) the strategies chosen by the players represent different behaviors.
• B) one player has a dominant strategy, and one does not.
• C) one player has a pure strategy, and one does not.
• D) the equilibrium strategy is an assignment of probabilities to pure strategies.
• E) the equilibrium strategy involves alternating between a dominant strategy and a Nash strategy.

---

Definitions:

Relationship Key Variables

Critical factors that impact the dynamics and outcomes of relationships in various contexts, including interpersonal and organizational settings.

Expectancy Theory of Motivation

The Expectancy Theory of Motivation suggests that individuals are motivated to act in ways that they believe will lead to desired outcomes, based on the expectation that their efforts will lead to certain rewards.

Group Needs

The requirements or desires that must be met for a group to function effectively, including cohesion, communication, and satisfaction.

Expectancy Theory Predicts

Suggests that an individual's motivation is influenced by the expectancy that effort will lead to performance, which will then lead to desired outcomes.