0 Kat is deciding if she would like to join the customer loyalty plan at Bonsai Plants and Books. For simplicity, suppose that 3 she
0 Kat is deciding if she would like to join the customer loyalty plan at Bonsai Plants and Books. For simplicity, suppose that 3 she and Patrick are the only consumers at Bonsai Plants and Books. You can think of these as types of people if that is easier for you. If Kat is the only one who joins, she gets great . deals. If Patrick also joins then the deals are not that great, but outsiders are the worst off in both cases. The box shows the payoffs from this. This is the prisoner's dilemma. What is the Nash equilibrium? 0 Kat joins, but Patrick does not join. 0 Kat does not join, but Patrickjoins. Q There are two Nash equilibria: both join, and both do notjoin. 0 Both join. Kat Joins Does not join Patrick Joins Does not join fj%\\ 200 0 200 l 000 1000 500 0 500
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