Question

87. Michigan (MI) and Wisconsin (WI) both border Lake Michigan. Both states pollute Lake Michigan and both states suffer the consequences of the pollution. However, the two states face a prisoner’s dilemma of the sort studied in Chapter 12. Each country must decide whether to protect or not to protect Lake Michigan from pollution. The payoffs from the choices are shown in the table below.

		Michigan
		Protect	Not Protect
Wisconsin	Protect	WI gains 500 MI gains 500	WI loses 300 MI gains 600
	Not Protect	WI gains 600 MI loses 300	WI loses 250 MI loses 250

From the table, we know that the outcome of this game will be

A. neither state choosing to protect the lake

B. Wisconsin choosing to not protect the lake, Michigan choosing to protect the lake

C. Wisconsin choosing to protect the lake, Michigan choosing to not protect the lake

D. both states choosing to protect the lake

Answer: A Reference:

Explanation:

89. Two logging companies are deciding whether or not to cut down a significant portion of a particular forest that both have access too. Both companies understand the environmental consequences of their actions, knowing that they are trading off higher profits for a better outcome from society’s point of view. The payoffs facing these companies are given in the table below.

		Company 2
		Cut	Do Not Cut
Company 1	Cut	1 loses 10 2 loses 10	1 gains 30 2 loses 20
	Do Not Cut	1 loses 200 2 gains 30	1 gains 20 2 gains 20

From the table, we know that the outcome of this game will be

A. neither Company choosing to cut the forest

B. Company 1 choosing to cut, Company 2 choosing not to cut

C. Company 2 choosing to cut, Company 1 choosing not to cut

D. both companies choosing to cut the forest

Answer: D Reference:

both question have different answer,,,,,,

Answer 1