Consider the following decision tree and information when answering the following questions:
The decision tree depicts two players (Jane and Aaron)playing an ultimatum game where Aaron is given $1,000 and asked to propose a way of splitting it with Jane.When Jane learns Aaron's proposal,Jane chooses whether to accept or reject the split.If Jane accepts the split,both players receive the money according to Aaron's split proposal.If Jane rejects the split,both players receive nothing.This game will be played only once,so Aaron does not have to worry about reciprocity when making his choice.
There are four sets of payoffs at the terminal nodes of the decision tree.In each node,the dollar amount to the left of the comma represents Aaron's payoff,and the dollar amount to the right of the comma represents Jane's payoff.

-If Aaron chooses to make a fair proposal,the likely outcome of the game will be that Jane will ________ and Aaron will receive a payoff of ________.
A) reject; $999
B) reject; $500
C) accept; $500
D) reject; $500.
E) reject; $0

Question

Consider the following decision tree and information when answering the following questions:
The decision tree depicts two players (Jane and Aaron)playing an ultimatum game where Aaron is given $1,000 and asked to propose a way of splitting it with Jane.When Jane learns Aaron's proposal,Jane chooses whether to accept or reject the split.If Jane accepts the split,both players receive the money according to Aaron's split proposal.If Jane rejects the split,both players receive nothing.This game will be played only once,so Aaron does not have to worry about reciprocity when making his choice.
There are four sets of payoffs at the terminal nodes of the decision tree.In each node,the dollar amount to the left of the comma represents Aaron's payoff,and the dollar amount to the right of the comma represents Jane's payoff.
 
-If Aaron chooses to make a fair proposal,the likely outcome of the game will be that Jane will ________ and Aaron will receive a payoff of ________.
A) reject; $999 
B) reject; $500 
C) accept; $500 
D) reject; $500. 
E) reject; $0

Quizplus · Accepted Answer

If Aaron chooses to make a fair proposal, Jane is more likely to accept it because it is a fair deal. In this case, Aaron proposes to split the money in half, giving Jane $500 and keeping $500 for himself. Since Jane is likely to accept the proposal, both players will receive a payoff of $500. This is the best choice for Aaron because, if he proposes a very unequal split, Jane is more likely to reject it, and both players will receive nothing.

Consider the Following Decision Tree and Information When Answering the Following