Which of the following best describes a Nash equilibrium?

A) An outcome from which one or both competitors can improve their position by adopting an alternative strategy.
B) The unstable outcome of a repeated game.
C) An outcome that is stable only because of credible threats.
D) An outcome that both competitors see as optimal, given the strategy of their rival.

Nash Equilibrium

A concept in game theory where each participant's strategy is optimal, given the strategies of all other participants, leading to a situation where no participant can benefit by changing strategies unilaterally.

Credible Threats

A declaration or signal that one party can make to convey they are prepared to follow through with a promised action if certain conditions are not met.