The prisoners' dilemma game
A)is a situation in which two players both have dominant strategies which lead to the highest total payoff for the two players.
B)has no Nash equilibrium since players, after agreeing to play their dominant strategy, will have an incentive to switch to another strategy.
C)has a Nash equilibrium, but the Nash equilibrium outcome is not the outcome the players would agree to if they could cooperate with each other.
D)Both a and c are correct.

Question

Quizplus · Accepted Answer

The prisoners' dilemma game has a Nash equilibrium, but it is not the optimal outcome for the players. In this game, both players have a dominant strategy to defect, which leads to a lower payoff for both players. If both players could cooperate and choose to not defect, they would both receive a higher payoff. However, because the players cannot communicate and trust each other, they end up choosing the dominant strategy and reaching the Nash equilibrium, which is the non-cooperative outcome.

The Prisoners' Dilemma Game