In the Prisoner's Dilemma Game

question 4

Multiple Choice

In the Prisoner's Dilemma game:

• A) complete solution is derived using the look ahead and extrapolate back principle.
• B) each player moves in succession.
• C) each player is aware of all prior moves.
• D) none of these.

---

Definitions:

Laffer Curve

A representation of the relationship between rates of taxation and the resulting levels of government revenue that illustrates there can be an optimum tax rate that maximizes revenue.

Tax Revenues

The income that is collected by governments through taxation.

Progressive Tax

A tax in which the average tax rate rises with income. People with higher incomes will pay a higher percentage of their income in taxes.

Proportional Tax

A tax in which the average tax rate is the same at all income levels. Everyone pays the same percentage of income in taxes.