Multiple Choice
In the above decision tree,Matthew picks first and Dean picks second.Matthew and Dean both know the payoffs to each choice for both themselves and each other.
-Refer to the decision tree above.Suppose Dean promises Matthew that he will always select the upper branch at either Y or Z.Dean offers to sign a legally-binding contract that penalizes him if he fails to choose the upper branch at Y or Z.For the contract to make Dean's promise credible,the value of the penalty must be
A) any positive number.
B) more than $1.5 million.
C) less than $100.
D) more than $500,000.
E) more than $500.
Correct Answer:

Verified
Correct Answer:
Verified
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