Business, 14.12.2019 06:31 emojigirl2824

You walk onto a used-car lot to buy a car. you are willing to pay up to $15,000 for a car of good quality but you value a lemon at $0.you are now wondering whether you should trust the car dealer regarding the quality of the car. if you choose to trust him, he can choose to cooperate or defect. if you do not trust him, neither will he earn money nor will you be able to buy a car and use it. if you trust him and he cooperates, both of you will gain because the dealer values a good-quality car at $13,000. however, if he defects, he will earn $15,000 while you will not derive any satisfaction.
refer to the scenario above; you should use to arrive at a decision.

a. forward induction
b. mixed strategies
c. backward induction
d. prisoners' dilemma

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