Alan and Beatrice are students who are being investigated for colluding on an assignment. Based on the figures showing their payoffs from their individual choices to deny or confes... Alan and Beatrice are students who are being investigated for colluding on an assignment. Based on the figures showing their payoffs from their individual choices to deny or confess, which of the following statements is correct?
Understand the Problem
The question is asking to analyze a payoff matrix between Alan and Beatrice based on their strategies of denying or confessing. We need to determine which of the statements regarding their dominant strategies and outcomes is correct based on the given game theory scenario.
Answer
(D, D) is the dominant strategy equilibrium when both students are completely selfish.
When both students are completely selfish, (D, D) is now the dominant strategy equilibrium.
Answer for screen readers
When both students are completely selfish, (D, D) is now the dominant strategy equilibrium.
More Information
In game theory, a dominant strategy is one that results in a higher payoff regardless of what the other player does. Here, 'Deny, Deny' (D, D) provides an optimal payoff for both Alan and Beatrice when they are completely selfish.
Tips
A common mistake is misinterpreting the payoff matrix or not considering the implications of being completely selfish on strategy choice.
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