Consider the following Payoff Matrix for the Prisoner\'s Dilemma Problem. Two pr

Question

Consider the following Payoff Matrix for the Prisoner's Dilemma Problem. Two prisoners A and B are kept in separate cells and not allowed to talk to each other. If they both confess that they committed a big crime, they get 7 years in prison each. If one confesses, that one is set free, while the other who refuses gets 14 years in prison. If they both refuse, they both get 2 years in prison for a petty offence. With reference to this example and the Payoff Matrix below, answer the questions next. [2 points each, total 10 points] A confesses A refuses B confesses A: -7, B: -7 A: -14, B: 0 B refuses A: 0, B -14 A: -2, B: -2 16. If n is number of years in prison (per player per action), the payoff function f for this matrix is b)f--n c) f- 2n d) f-n/2 17. Which state constitutes an example of Nash equilibrium here? a) Both confess b) Both refuse c) A confesses, B refuses d) B confesses, A refuses 18. Does the Nash equilibrium provide the best cumulative payoff and / or best individual gain here? a) Cumulative payoffb) Individual gain c) Both d) Neither 19. Is this an example of a constant sum game? a) Yes b) No c) Maybe d) Impossible to tell 20. It is found that a Repeated Game in this problem is most likely to give a) Freedom to A or Bb) Maximumn c) Nash equilibrium d) Best cumulative payoff

Explanation / Answer

17. Nash equilibrium if both confesses or both refuses

If each player has chosen a strategy and no player can benefit by changing strategies while the other players keep theirs unchanged, then the current set of strategy choices and the corresponding payoffs constitutes a Nash equilibrium.

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