When countries spend increasingly large amounts of funds on military production as a means of impressing an equally powerful antagonistic neighbor with possible military superiority,a prisoners' dilemma evolves since both countries would be better off if they did not pursue such a strategy.This is an example of:

A) a tacit agreement.
B) an arms race.
C) a price leadership model.
D) exclusive dealing.

Arms Race

A competition between nations to achieve superior military capability, often involving the accumulation of weapons and technological advancements.

Prisoners' Dilemma

A situation in game theory where two individuals acting in their own best interest do not produce the optimal outcome for either party.

Military Production

The manufacture and supply of equipment, materials, and services for armed forces and defense purposes.