$17$

Multiple Choice $1$ point

Consider the following setting for questions $17-18$

Imagine a director of a large financial company is trying to decide whether to spend responsibly or irresponsibly during a financial crisis. The director knows at the same time, the government is deciding whether or not to bail his company out out. He also knows that voters will be upset with the government $($and not the financial institution$)$ if things do go poorly.

$\backslash$table$[[,$Responsible Spending,Irresponsible Spending$],[$Bail out,$\backslash$table$[[$Company: $$100$M$],[$Government:$-$$$20$M$]],\backslash$table$[[$Company: $$150$M$],[$Government:$-$$$70$M$]]],[$No Bail out,$\backslash$table$[[$Company: $$70$M$],[$Government: $$10$M$]],\backslash$table$[[$Company:$-$$$10$M$],[$Government:$-$$$100$M$]]]]$

This game has two Nash Equilirbia $($in pure strategies$).$ What are they?

I. Responsible spending $+$ bail out

II$.$ Responsible spending $+$ no bail out

III. Irresponsible spending $+$ bail out

IV$.$ Irresponsible spending $+$ no bail out

I and II

I and III

I and IV

II and III

II and IV

III and IV