Exam 13: Game Theory and Competitive Strategy

Scenario 13.16 Consider the pricing game below: -To deter a potential entrant,an existing firm in a market may threaten to sharply increase production so that the entrant will be left with a small share of the market.The firm can make this threat credible by limiting its own options,and possible actions of this type include:

Scenario 13.5 Consider the following game: -Which of the following is true regarding the game in Scenario 13.5?

Scenario 13.16 Consider the pricing game below: -Refer to Scenario 13.16.If Gooi moves first,the payoff in equilibrium will be

Scenario 13.8 Consider the following game: -In game in Scenario 13.8,

Casey's General Store is considering placing a store in Hamilton,Missouri.If they place the store in Hamilton and no other convenience store enters the Hamilton market,they'll earn profits of $100,000 per year.If competitors do enter,Casey's profits as well as the competitor's profits will be reduced to $0 per year.If a competitor enters the Hamilton market and Casey's does not,the competitor's profits will be $100,000 per year. Does either player have a dominant strategy? Does the game have any Nash equilibria? What is the maximin strategy of each player in the game?

Use the following statements to answer this question: I.The expected revenue generated by first-price and second-price sealed-bid auctions is the same. II.The winner's curse implies that the buyer of an auctioned item will likely be the person who made the largest positive error in their estimated value of the item.

Scenario 13.14 Consider the game below: -In the game in Scenario 13.14,

Scenario 13.17 Consider the entry-deterrence game below.The potential entrant would have to spend some amount in sunk costs to enter the market. -If the game in Scenario 13.17 were to be infinitely repeated,waging a price war might be a rational strategy

Tony and Larry are managers of baseball teams that currently playing a game.It's late in the ballgame and Tony's team is currently winning and in the field.Tony's strategies are to bring in a right handed pitcher (RHP)or to bring in a left handed pitcher (LHP).Larry's strategies are to bring in a right handed pinch hitter (RPH)or to bring in a left handed pinch hitter (LPH).The pay-off matrix is in terms of winning (W)or losing (L)the game.Does either player have a dominant strategy? Does the game have a Nash equilibrium? What is the maximin strategy of each player in the game?

Nash equilibria are stable because

Scenario 13.8 Consider the following game: -In game in Scenario 13.8,what will occur if IVY Corp.plays a maximin strategy?

Consider the following game that represents the payoffs from different advertising campaigns (low,medium,and high spending)for two political candidates that are running for a particular office.The values in the payoff matrix represent the share of the popular vote earned by each candidate: Under the version of the game in which Candidate A moves first,what is the Nash equilibrium?

Scenario 13.9 Consider the following game: Two firms are situated next to a lake,and it costs each firm $1,500 per period to use filters that avoid polluting the lake.However,each firm must use the lake's water in production,so it is also costly to have a polluted lake.The cost to each firm of dealing with water from a polluted lake is $1,000 times the number of polluting firms. -A "mixed strategy" equilibrium means that

For infinitely repeated games in which the players follow a tit-for-tat strategy,which one of the following outcomes is NOT possible?

Gym X and Bodyworks are both going to open an exercise facility in the local market.Each company may decide to open a facility concentrating on cardio equipment for customers interested in mostly aerobic workouts.Another alternative for each company is to open a facility concentrating on muscle building equipment for customers interested mostly in bodybuilding workouts.The pay-off matrix for each company dependent upon their strategies and that of their competitor is given below. Does either player have a dominant strategy? Does the game have any Nash equilibria? What is the maximin strategy of each player in the game?

Scenario 13.16 Consider the pricing game below: -La Tortilla is the only producer of tortillas in Santa Teresa.The firm produces 10,000 tortillas each day and has the capacity to increase production to 100,000 tortillas each day.La Tortilla has made a large profit for years,but no other firm has chosen to compete in the Santa Teresa tortilla market.La Tortilla has been able to deter entry because if other firms were to enter the market it would greatly step-up production and reduce price.

Scenario 13.15 Consider the pricing game below: -Refer to Scenario 13.15.If the firms price simultaneously,equilibrium would be

What kind of game is shown in Scenario 13.13?

Dale and Terry are racing automobiles around a track.Currently,Terry is in the lead.However,Dale has a faster car and is just behind Terry.The racers' strategies and pay-offs are presented in the table below. Does either player have a dominant strategy? Does the game have a Nash equilibrium? What is the maximin strategy of each player in the game?

Scenario 13.12 Consider the game below: -Playing the game in Scenario 13.12 sequentially would