Why can't two firms in a Prisoners' Dilemma enforce a better ...

[charchew]

Why can't two firms in a Prisoners' Dilemma enforce a better outcome that has higher payoffs?
 
  A) Under an outcome with higher payoffs, the outcome is not a Nash equilibrium and each firm has an incentive to change their actions.
  B) Barriers to entry
  C) Barriers to exit
  D) The Nash equilibrium in a Prisoners' Dilemma has the highest possible payoffs for both firms.

Question 2

Refer to Figure 9.7. After the policy was implemented, the quantity traded became
 
  A) 1000.
  B) 2000.
  C) 3000.
  D) 4000.
  E) between 2000 and 4000, but the amount depends upon producers' reactions, which are uncertain.

[aprice35067]

Answer to Question 1

A

Answer to Question 2

B

[charchew]

Thank you

[aprice35067]

Happy to help you