Consider the following three-
player team production problem. Simultaneously and independently, each player chooses
between exerting effort (E) or not exerting effort (N). Exerting effort imposes a cost of
2 on the player who exerts effort. If two or more of the players exert effort, each player
receives a benefit of 4 regardless of whether she herself exerted effort. Otherwise, each
player receives zero benefit. The payoff to each player is her realized benefit less the cost
of her effort (if she exerted effort). For instance, if player 1 selects N and players 2 and
3 both select E, then the payoff vector is (4,2,2). If player 1 selects E and players 2 and
3 both select N, then the payoff vector is (-2,0,0)