How to outsmart the Prisoner’s Dilemma

We predict that in the finite prisoner’s dilemma illustrated here:

• 
  The gingerbread men will choose to cooperate.

• The gingerbread men can cooperate, but only if they agree to it beforehand.

• One gingerbread man will cooperate, but the other will sacrifice.

• 
  The gingerbread men will never cooperate.

With a delta discount factor of .25, then $12.00 today is worth _____ to us tomorrow

• $2.50

• $3.00

• $6.00

• $9.00

With a delta of 0, then we know that the gingerbread men will

• Continue to turn on each other in each period, forever.

• 
  Sometimes cooperate (spare) with each other.

• Always cooperate (spare) each other for the rest of time.

• 
  It’s not possible to tell without more information.

With a discount factor higher than 1/3, for the game shown in the video, players have:

• Incentive to cooperate because they care about the future less.

• No incentive to cooperate because they care about the future less.

• Incentive to cooperate because they care about the future more.

• No incentive to cooperate because they care about the future more.

If the payoff for sacrificing the other was increased, then all else equal, we expect that the delta required for cooperation will be:

• Higher

• Lower

• Unchanged

• We cannot tell from the information provided