Figure 17-3

question 231

Multiple Choice

Figure 17-3. Katie and Taylor are roommates. On a particular day, their lawn needs to be mowed. Each person has to decide whether to take part in mowing the lawn. At the end of the day, either the lawn will be mowed (if one or both roommates take part in mowing) , or it will remain unmowed (if neither roommate mows) . With happiness measured on a scale of 1 (very unhappy) to 10 (very happy) , the possible outcomes are as follows:

-Refer to Figure 17-3.The dominant strategy for Taylor is to

• A) mow, and the dominant strategy for Katie is to mow.
• B) mow, and the dominant strategy for Katie is to refrain from mowing.
• C) refrain from mowing, and the dominant strategy for Katie is to mow.
• D) refrain from mowing, and there is no dominant strategy for Katie.

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Definitions:

Commodities

Basic goods used in commerce that are interchangeable with other goods of the same type.

Transitive

In economics and decision theory, referring to preferences that are consistent in their ranking: if option A is preferred over B, and B over C, then A is preferred over C.

Indifference

A state or condition of a consumer where different combinations of goods or outcomes are perceived as equally preferable.

Bundles

A collection of goods or services sold as a single package, often offered at a discount compared to buying each item separately.