Nash Equilibrium

[Chinni18]

Suppose that two consumers – A and B – can each choose to contribute either $0 or $10 to
provide units of the public good. The matrix below gives the pair of pay-offs to each
consumer from the different combinations of contribution levels. The first entry of each pair
is the pay-off to A and the second entry is the pay-off to B.
Which of the following combinations of strategies form the Nash equilibrium?

                                   Person A
                                $0              $10
               $0             0,0            100, 400
Person B    $10          150,200     200,300

a) Person A contributes $0, person B contributes $0.
b) Person A contributes $0, person B contributes $10.
c) Person A contributes $10, person B contributes $0.
d) Person A contributes $10, person B contributes $10.
e) More than one of the above combinations is a Nash equilibrium.

How is B the correct answer?

[anon_econ]

i'm getting c!

On Wed, Jun 20, 2012 at 1:50 PM, Chinni18 [via Discussion forum] <[hidden email]> wrote:

Suppose that two consumers – A and B – can each choose to contribute either $0 or $10 to
provide units of the public good. The matrix below gives the pair of pay-offs to each
consumer from the different combinations of contribution levels. The first entry of each pair
is the pay-off to A and the second entry is the pay-off to B.
Which of the following combinations of strategies form the Nash equilibrium?

                                   Person A
                                $0              $10
               $0             0,0            100, 400
Person B    $10          150,200     200,300

a) Person A contributes $0, person B contributes $0.
b) Person A contributes $0, person B contributes $10.
c) Person A contributes $10, person B contributes $0.
d) Person A contributes $10, person B contributes $10.
e) More than one of the above combinations is a Nash equilibrium.

How is B the correct answer?

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[Chinni18]

Yes Vasudha, even I was getting c, so confused 
It is Q.9 on page 4 of this file:
Econ313SampleFinalQuestions_S11_ans.pdf
It seems reliable, so I figured I'm doing something wrong

[anon_econ]

hmm. i dunno. duznt look like there could be some catch in this one :P

On Wed, Jun 20, 2012 at 2:21 PM, Chinni18 [via Discussion forum] <[hidden email]> wrote:

Yes Vasudha, even I was getting c, so confused 
It is Q.9 on page 4 of this file:
Econ313SampleFinalQuestions_S11_ans.pdf
It seems reliable, so I figured I'm doing something wrong

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[aditi5000]

Its c only ... probably a typo :P

[Chinni18]

Thanks aditi and Vasudha  Thought I was doing something wrong

[Khagesh]

Umm.....i thnk it shld b 2 only... q is abt Nash equib!!

[aditi5000]

Nash eqbm gives option c

[Khagesh]

Well nash euib is abt both trying to attain better state bt none attains the best . In option c B attains the best state. Isnt dat d logic??