Two members of a criminal-gang are arrested and imprisoned. The prosecutors lack sufficient evidence to convict the pair on the principal charge. However, the prosecutors offer each prisoner a bargain simultaneously. Each prisoner is given the opportunity either to: betray the other by testifying that the other committed the crime, or to remain silent. Let us call them Prisoner A and Prisoner B, and let us analyze how Prisoner A should make a decision.
Prisoner A has two alternatives as mentioned above. What he does not know is Prisoner B’s action. But he knows that 1) if they both remain silent, then they are both sentenced to a year in prison on a lesser charge, 2) if he betrays and B remains silent, then he goes free while B will be sentenced to three years in prison, 3) if he remains silent and B betrays, then he will be sentenced to three years in prison while B goes free, and 4) if they both betray the other, then they are both sentenced to two years in prison.
Now, remember that they are in solitary confinement with no means of communicating with the other. Furthermore, they are both self-interested and
have no loyalty to each other whatsoever. Determine the appropriate decision under uncertainty for Prisoner A using the following decision rules, respectively:
Hint: The events (states of nature) to A are B’s possible actions.
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