Figure 17-2

question 285

Multiple Choice

Figure 17-2. Hector and Bart are roommates. On a particular day, their apartment needs to be cleaned. Each person has to decide whether to take part in cleaning. At the end of the day, either the apartment will be completely clean (if one or both roommates take part in cleaning) , or it will remain dirty (if neither roommate cleans) . With happiness measured on a scale of 1 (very unhappy) to 10 (very happy) , the possible outcomes are as follows:

-Refer to Figure 17-2.In pursuing his own self-interest,Bart will

• A) refrain from cleaning whether or not Hector cleans.
• B) clean only if Hector cleans.
• C) clean only if Hector refrains from cleaning.
• D) clean whether or not Hector cleans.

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Definitions:

Stock

Shares in the ownership of a company, representing a claim on part of the corporation's assets and earnings.

Share

A unit of ownership in a company or financial asset that gives the holder a claim on part of the company's assets and earnings.

Transfer Agent

An entity appointed by a corporation to maintain records of investors, account balances, and transactions; to issue and cancel shares; and to handle share transfers.

Financial Institution

An establishment that conducts financial transactions such as investments, loans, and deposits.