-Consider the Oil-Drilling Game Depicted in Figure 5

Multiple Choice

-Consider the oil-drilling game depicted in Figure 5.4 in which payoffs are in millions of dollars. Suppose that this game is played repeatedly and the probability that the game will be played in the next round is 20 percent. At what discount rate are the players indifferent between cooperating and defecting?

A) 25 percent.
B) 27.5 percent.
C) 32.75 percent.
D) 45 percent.
E) None of the above.