Question
Six students are going on a foreign trip on which they will live close together. Where they are going, there is a disease which spreads
Six students are going on a foreign trip on which they will live close together. Where they are going, there is a disease which spreads easily among people who live close together. The value of the trip to a student who does not get the disease is 6. The value of the trip to a student who gets the disease is 0.
There is a vaccination against the disease. The cost of vaccination is x. If a student gets vaccinated, she will not get the disease. However, if she is not vaccinated, then her probability of getting the disease depends on the total number in the group who are not vaccinated. If she is the only person not to get vaccinated, then the probability that she gets the disease is 1/6. If there is one other person who is not vaccinated (i.e., two in all including her) then the probability that she gets the disease is 2/6. If there are two other people who are not vaccinated (i.e., three including her) then the probability that she gets the disease is 3/6, etc.
Suppose that each student aims to maximize her expected payoff. The students decide, individually and simultaneously, whether or not to get a vaccination.
Question: For this part, let the cost of vaccination be x = 1.80. Suppose that everyone gets vaccinated. Is this a Nash equilibrium?
Select one:
a. No, because if everyone is vaccinated, a student will regret her choice.
b. Yes, because when one anticipates everyone else to be vaccinated, it is better to be vaccinated herself.
c. Yes, because everyone gets the best payoff this way.
d. No, because vaccination is harmful for one's health.
e. The concept of Nash equilibrium cannot be used in this context.
f. Yes, because vaccination is a safer choice.
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