Chapter 65, Problem 1MCQ

To determine

To choose: The option that states the situation when each player has the incentive to choose an action when both have chosen it makes them both worse off.

Answer to Problem 1MCQ

Correct option is B i.e., Prisoner’s dilemma.

Explanation of Solution

The option that states the situation when each player has the motivation to select an action when both have chosen it, makes them both not as good as is referred to as a prisoner’s dilemma.

A prisoner’s dilemma is referred to as a situation wherein two parties, who are separated and are not able to communicate, are required to choose between cooperating with the other or not and the highest prize for each party occurs when both the parties choose to cooperate.