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To illustrate the situation, the following table shows the relative fatality risk in a 'ontal collision between two cars. Here the extreme vehicle sizes of

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To illustrate the situation, the following table shows the relative fatality risk in a 'ontal collision between two cars. Here the extreme vehicle sizes of 4'WD and small car are considered. m (9319-3) {110. 0-06) n (cos, 1m) {1_,1-} The fatality risk is the number of fatalities per number of occupants, and the relative tality risk is dened here as the ratio of the fatality risk of collision between two cars to the fatality risk of collision between two 4'WD cars. For example, 13.8 in the rst cell means that the mimber of fatalities per occupant in collision between two small cars is 0.3 times of the number of fatalities per occupant in collision between two 415W) cars. Also 17", in the rst bottom cell, means that the number of fatalities per occupant in collision between a 4mm and a small car for a small car is 1? times of the number of fatalities per occupant in collision between two 4% cars. b. Is the situation depicted in the table the classic prisoner's dilemma problem? Explain why. \"Eben considering buying a vehicle, the consumer for whom occupant protection is a major issue will always prefer to buy a 4'WD to a small car because it is the dominant strategy. However, if everylzrodjg.r buys a small car a higher level of safety will be achieved and the outcome is Pareto superior. c. What do you suggest to encourage consumers to buy small cars? Do you agree with a tax an more. aggressive vehicles? What about an increase. in insurance. fees for lamer vehicles\

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