Multiple Choice
This figure shows the payoffs involved when Sarah and Joe work on a school project together for a single grade.They both will enjoy a higher grade when more effort is put into the project,but they also get pleasure from goofing off and not working on the project.The payoffs can be thought of as the utility each would get from the effort they individually put forth and the grade they jointly receive.
According to the figure shown:
A) there is no stable equilibrium to the game.
B) both will act in their own self-interest and get a stable, but less than optimum, equilibrium.
C) both will act in their own self-interest and get an optimum equilibrium that is stable.
D) both have incentive to put forth high effort.
Correct Answer:

Verified
Correct Answer:
Verified
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