-The Table Above Shows the Payoff Matrix Offered to Two

question 134

Multiple Choice

-The table above shows the payoff matrix offered to two suspected criminals,Bonnie and Clyde.The payoffs are the years they will spend in prison.The suspected criminals are not allowed to communicate.Given the information in the payoff matrix,the Nash equilibrium is

• A) Bonnie confesses only if she thinks Clyde denies committing the crime.
• B) Clyde confesses only if he thinks Bonnie denies committing the crime.
• C) both Bonnie and Clyde confess to the crime.
• D) both Bonnie and Clyde deny committing the crime.
• E) Clyde confesses and Bonnie might either confess or not confess, either outcome is consistent with the Nash equilibrium.

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Definitions:

Average Collection Period

A financial metric used to evaluate the average number of days a company takes to collect payments from its credit sales.

Acid-test Ratio

A stringent indicator of a company's liquidity, calculated by dividing liquid assets by current liabilities, to determine if it can meet short-term obligations.

Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term financial health and operational efficiency.

Inventory Turnover

A ratio showing how many times a company sells and replaces its stock of goods within a certain period.