29 the Payoff Matrix Below Shows the Payoffs for Firm

question 81

Multiple Choice

29 The payoff matrix below shows the payoffs for Firm A and Firm B, each of whom can either "cooperate" or "cheat". The numbers in parentheses are (payoff for A, payoff for B) . $$\begin{array}{l}\begin{array} { | l | l | l | l | } \hline & & \text { Firm B } & \\\hline & & \text { Cooperate } & \text { Cheat } \\\hline \text { Firm A } & \text { Cooperate } & ( 30,30 ) & ( 10 , x ) \\\hline & \text { Cheat } & ( x , 10 ) & ( 20,20 ) \\\hline\end{array}\\\text { TABLE 11- } 2\end{array}$$
-Refer to Table 11- 2. If x = 40, what is the Nash equilibrium in this game?

• A) (Firm A: cheat, Firm B: cheat)
• B) (Firm A: cooperate, Firm B: cheat)
• C) (Firm A: cheat, Firm B: cooperate)
• D) (Firm A: cooperate, Firm B: cooperate)
• E) there is no Nash equilibrium for this value of x

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Definitions:

Laboratory Experiments

Controlled tests or investigations conducted in a lab setting where variables can be isolated and manipulated to study their effects.

Evaluation Apprehension

Worry about how others perceive or assess one's actions.

Social Desirability

The tendency of respondents to answer questions in a manner that will be viewed favorably by others.

Experimental Result

The outcome obtained from conducting a scientific experiment, typically reflecting the impact of specific variables tested.