Multiple Choice
The table below shows the payoff matrix in the form of short-run profit for two firms,A and B,for two different strategies,investing in new capital or not investing.
-Refer to the payoff matrix above.The reason the game is a prisoner's dilemma is that
A) both firms choose the same strategy.
B) both firms have a dominant strategy.
C) both firms find that their dominant strategies produce a better outcome than their dominated strategies.
D) both firms find that their dominated strategies produce a better outcome than their dominant strategies.
E) neither firm has a dominant strategy.
Correct Answer:

Verified
Correct Answer:
Verified
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