Scenario: Jim and Janis must complete a task together at their job. Jim can put no effort, low effort, or high effort into the job, while Janis, being more conscientious than Jim, has choice of low effort or high effort. Their compensation, summarized in the payoff matrix below (in thousands of dollars), depends on the quality of their work, which in turn depends on the efforts they put into the task. The first number in each cell is Jim's payoff, and the second number is Janis' payoff.

-Refer to the scenario above.If a 3,then ________.
A) low effort by Jim and high effort by Janis form a Nash equilibrium
B) high effort by Jim and low effort by Janis form a Nash equilibrium.
C) low effort by Jim and low effort by Janis form a Nash equilibrium
D) no pair of effort levels forms a Nash equilibrium

Question

Scenario: Jim and Janis must complete a task together at their job. Jim can put no effort, low effort, or high effort into the job, while Janis, being more conscientious than Jim, has choice of low effort or high effort. Their compensation, summarized in the payoff matrix below (in thousands of dollars), depends on the quality of their work, which in turn depends on the efforts they put into the task. The first number in each cell is Jim's payoff, and the second number is Janis' payoff.
 
-Refer to the scenario above.If a > 3,then ________.
A) low effort by Jim and high effort by Janis form a Nash equilibrium 
B) high effort by Jim and low effort by Janis form a Nash equilibrium. 
C) low effort by Jim and low effort by Janis form a Nash equilibrium 
D) no pair of effort levels forms a Nash equilibrium

Quizplus · Accepted Answer

The Answer of Scenario: Jim and Janis must complete a task together at their job. Jim can put no effort, low effort, or high effort into the job, while Janis, being more conscientious than Jim, has choice of low effort or high effort. Their compensation, summarized in the payoff matrix below (in thousands of dollars), depends on the quality of their work, which in turn depends on the efforts they put into the task. The first number in each cell is Jim's payoff, and the second number is Janis' payoff.
 
-Refer to the scenario above.If a > 3,then ________.
A) low effort by Jim and high effort by Janis form a Nash equilibrium 
B) high effort by Jim and low effort by Janis form a Nash equilibrium. 
C) low effort by Jim and low effort by Janis form a Nash equilibrium 
D) no pair of effort levels forms a Nash equilibrium

Scenario: Jim and Janis Must Complete a Task Together at Their