(Table: Mary, Silvia Payoff Table) Refer to the Table

question 90

Multiple Choice

(Table: Mary, Silvia Payoff Table) Refer to the table. Maryand Silvia are producers. If Silvia cooperates, what is Mary'sdominant strategy?

• A)to cheat and earn 40
• B)to cheat and earn 15
• C)to cooperate and earn 20
• D)to cooperate and earn 40

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Definitions:

Marginal Rate of Substitution

The rate at which a consumer is willing to give up one good in exchange for another, keeping utility constant.

Rational

The quality of being based on or in accordance with reason or logic.

Indifference Curves

A graph representing different bundles of goods between which a consumer is indifferent, showing equal levels of utility.

Preference Map

A relationship between two variables, X and Y, in which a decrease in X is associated with a decrease in Y, and an increase in X is associated with an increase in Y.