Why does a prisoner's dilemma lead to a noncooperative equilibrium?
A) because each player had agreed before the game started to minimize the harm that he can inflict on the other players
B) because each player is uncertain how other players will play the game
C) because players must choose from a limited number of non-dominant strategies
D) because each rational player has a dominant strategy to play a certain way regardless of what other players do
Answer: D
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A country opens up to trade and imports clothing. In the clothing market, surplus has been redistributed from
A) producers to consumers. B) consumers to producers. C) government to consumers. D) producers to government.
Which of the following would lead domestic investment to rise?
A) an increase in government spending throughout the world B) an increase in world taxes C) an increase in world autonomous consumption D) all of the above E) none of the above