In Which of the Following Games Is It Clearly the Case

question 502

Multiple Choice

In which of the following games is it clearly the case that the cooperative outcome of the game is good for the two players and good for society?

• A)Two guilty criminals have been captured by the police, and each prisoner decides whether to confess or to remain silent.
• B)Two airlines dominate air travel between City A and City B, and each airline decides whether to charge a "high" airfare or a "low" airfare.
• C)Two duopoly firms account for all of the production in a market, and each firm decides whether to produce a "high" amount of output or a "low" amount of output.
• D)Two oil companies own adjacent oil fields over a common pool of oil, and each company decides whether to drill one well or two wells.

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Definitions:

Duress

A situation where a person performs an act as a result of violence, threat, or other pressures against them.

Coercion

The act of compelling a party to act in an involuntary manner by use of threats or force.

Contract

A legally binding agreement between two or more parties that outlines obligations, rights, and terms that are enforceable by law.

Material Errors

Significant mistakes or inaccuracies that impact the understanding, operation, or outcome of a document, financial statement, or process.