Adam and Jon Are the Only Players Playing in a Local

question 150

Multiple Choice

Adam and Jon are the only players playing in a local golf tournament.They can either practice for 5 hours or not practice at all.Practice has both direct monetary costs and opportunity costs.Their scores for an 18-hole round of golf with and without practice are shown in the table.Total prize money is $12,000.Two possible reward structures exist.In Plan A,the low score wins $10,000,second place wins $2000,and a tie results in $6000 each.Plan B requires a player to score 71,or less,for first place,72 to 80 is considered second place.The $10,000 will be split between those with a 71 or lower score,with a guaranteed minimum of $2000.The $2000 for second will be split between those with a score between 72 and 80.
-Refer to the information above.Since Plan A causes __________,this is an example of a(n) __________.

• A) neither Jon nor Adam to practice;positional arms race
• B) neither Jon nor Adam to practice;prisoner's dilemma
• C) both Jon and Adam to practice;absolute performance judgement
• D) Jon to practice and Adam not to practice;positional externality
• E) both Jon and Adam to practice;positional arms race

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Voidable Title

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