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X Please read the following illustration: Jon and Bana have both been *0/1 accused of insider trading. Jon knows that if he confesses while Bana
X Please read the following illustration: Jon and Bana have both been *0/1 accused of insider trading. Jon knows that if he confesses while Bana keeps silent, he will receive a 1-month jail sentence. He also knows that if Bana confesses and he keeps silent, he will receive a 12-month jail sentence. If neither of them confesses, there will be insufcient evidence to convict either of insider trading, but there is enough evidence to convict each of them individually of obstructing justice, which carries a 2- month sentence. If both of them confess, they will both serve a 3-month jail sentence. This situation is: an example of cartel behavior. X an application of the prisoner's dilemma. not realistic because those accused of insider trading are never encouraged to confess. OOO not realistic because those accused of insider trading always keep silent
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