Suppose Jordan and Lee Are Trying to Decide What to Do

question 65

Multiple Choice

Suppose Jordan and Lee are trying to decide what to do on a Friday. Jordan would prefer to see a comedy while Lee would prefer to see a documentary. One documentary and one comedy are showing at the local cinema. The payoffs they receive from seeing the films either together or separately are shown in the payoff matrix below. Both Jordan and Lee know the information contained in the payoff matrix. They purchase their tickets simultaneously, ignorant of the other's choice.   
Suppose a timing element is added to the game, and that Jordan buys a ticket first. Then, after seeing Jordon's choice, Lee buys a ticket. What will be the equilibrium outcome?

• A)Both Jordan and Lee will buy a ticket to the comedy.
• B)Both Jordan and Lee will buy a ticket to the documentary
• C)Jordan will buy a ticket to the comedy and Lee will buy a ticket to the documentary.
• D)Jordan will buy a ticket to the documentary and Lee will buy a ticket to the comedy.

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Definitions:

Executive-Type Norms

Guidelines or standards set by those in leadership positions within organizations, influencing behavior and decision-making.

Student Norms

Refers to the unwritten rules and expectations that govern behavior within a student community.

Conform

To align one's behavior, beliefs, or standards to those of a group or society, often due to peer pressure or societal norms.