Consider an Example of the Prisoner's Dilemma Where 2 Firms

question 27

Multiple Choice

Consider an example of the prisoner's dilemma where 2 firms are making sealed bids on a contract and each firm is allowed to bid either $100 or $180.If both firms bid the same price,the job is shared equally and each firm earns half the value of its bid.Otherwise the lowest bidder wins the contract and receives the full value of its bid (and the other bidder earns zero) .The cooperative outcome in this situation is

• A)both firms bid $180.
• B)both firms bid $100.
• C)both firms bid $50.
• D)one firm bids $100,the other firm bids $180.
• E)both firms bid $90.

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Definitions:

Membrane Depolarizes

The process by which a cell membrane's voltage becomes less negative, leading to the possible firing of an action potential in neurons.

Sperm

Male gamete having a haploid number of chromosomes and the ability to fertilize an egg, the female gamete.

Egg

Also called an ovum; haploid cell that is usually fertilized by a sperm to form a diploid zygote.

Fertilize

The process of a sperm cell joining with an egg cell to initiate the development of a new organism.