Table 12.1 Utility Payoffs to Thief 1 and Thief 2 in a in a Classic

question 17

Multiple Choice

Table 12.1
Utility Payoffs to Thief 1 and Thief 2 in a Classic Prisoners' Dilemma Game
Payoffs are given as utility where U = 10-years in Jail

-According to,if Thief 1 confesses and Thief 2 remains silent to the crime,how many years in jail will each thief serve?

• A) Thief 1 - 2 years; Thief 2 - 2 years
• B) Thief 1 - 7 years; Thief 2 - 7 years
• C) Thief 1 - 0 years; Thief 2 - 10 years
• D) Thief 1 - 10 years; Thief 2 - 0 years

---

Definitions:

Interest Rates

The cost of borrowing money, expressed as a percentage of the amount borrowed.

Loanable Funds Market

The hypothetical market that illustrates the interaction between borrowers who demand loanable funds and lenders who supply loanable funds, determining the equilibrium real interest rate.

Surplus

Surplus is the situation in which the quantity supplied of a product or service exceeds the quantity demanded, often leading to lower prices.

Equilibrium Interest Rate

The interest rate at which the supply of savings meets the demand for investment funds in a market, leading to an economic balance.