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In a study conducted at the economic laboratory, Person A is randomly placed in a group with other participants.
The pairing is anonymous, meaning that none of the participants will ever know the identity of the other participants
with whom he or she is paired.
In the experiment, all the group members will make a choice, the experimenter will record this choice,
and then all individuals will be informed of the choices made by other individuals and paid money based on
the choices made by all individuals, as well as a small participation fee. Suppose that neither individual
will receive any other money for participating in the experiment.
Each member of the group has to choose simultaneously between two possible actions: action X or action Y.
If at least one member of the group selects action X, all individuals that selected Y obtain 10€ and all
individuals that selected X obtain 7€. If no member of the group selects action X, all individuals of
the group obtain 0€.
Since the decisions are taken simultaneously, Person A does not know the decisions of the other members of
the group. Other members of the group do not know the decision of Person A, nor the decisions of
other individuals.
For example, if Person A selects X, Person A, and all the individuals that selected X, obtain 7€.
All the individuals that selected Y obtain 10€. If Person A selects Y, Person A, and all individuals that
selected Y, obtain 10€ if at least one individual selected X, and 0€ otherwise.
In this case, we ask you to evaluate the choice of Person A (choosing X or Y) depending on the number of members of the group.
You will have to evaluate 4 different cases.