Exam 13: Game Theory and Competitive Strategy

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.The goal of the drivers is to do as well as possible in the race.There are a total of 43 cars on the track. 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?

A Nash equilibrium occurs when

An oligopolistic situation involving the possible creation of barriers to entry would probably best be modeled by a

Scenario 13.10 Consider the game below: -Which of the below outcomes is the result of a Nash equilibrium in pure strategies for the game in Scenario 13.10?

As defined by Thomas Schelling,a "strategic move" is

Joanna has a credit card account with Card Bank.Card Bank's available strategies are tp raise Joanna's credit card interest rate or do nothing.Joanna's available strategies are to transfer her Card Bank account balance to another creditor or do nothing.If Card Bank raises Joanna's interest rate and Joanna does nothing,Card Bank increases profits by $1,000 while Joanna receives -$1,000.If Card Bank raises Joanna's interest rate and Joanna transfers her account to another creditor,Card Bank receives -$300 while Joanna receives -$100.If Card Bank does nothing and Joanna does nothing,each player receives $0.If Card Bank does nothing and Joanna transfers her account to another creditor,Card Bank receives -$300 while Joanna receives -$150.Diagram the game tree for this sequential game.Indicate any Nash equilibria.

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. -What is true about dominant strategies in the game in Scenario 13.9?

Scenario 13.16 Consider the pricing game below: -Refer to Scenario 13.16.If the firms must choose their prices simultaneously,

If both players in a game have dominant strategies,we say that the game has:

If,in the game in Scenario 13.14,R moves first,it will select

Joanna has a credit card account with Card Bank.Card Bank's available strategies are to raise Joanna's credit card interest rate or do nothing.Joanna's available strategies are to transfer her Card Bank account balance to another creditor or do nothing.The strategy pay-offs are indicated 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?

An auction in which a seller begins by offering an item for sale at a relatively high price and then reduces the price by fixed amounts until receiving a bid is known as a:

Two firms in a local market compete in the manufacture of cyberwidgets.Each firm must decide if they will offer a warranty or not.The pay-offs of each firm's strategy is a function of their competitor as well.The pay-off matrix is presented below. If firm #1 announces it will offer a warranty regardless of what firm #2 does,is this a credible threat? Why or why not?

The Matching Pennies game is an example of a:

Your firm needs a private investigator and the best private eye in Santa Teresa is Kinsey Milhone.Her services are worth $30,000 to your firm but you do not want to pay her more than $10,000.You tell Kinsey that you cannot pay her more than $10,000 unless you get prior approval from the Board of Directors of your company,and,unfortunately,they just met and won't meet again for 6 months.This strategic move on your part gives you __________ flexibility and __________ bargaining power.

Scenario 13.16 Consider the pricing game below: -Refer to Scenario 13.16.If Gooi can move first,and Ici threatens to buy yogurt machines,no matter what Gooi does,

Two firms in a local market compete in the manufacture of cyberwidgets.Each firm must decide if it will offer a warranty or not.The pay-offs of each firm's strategy is a function of their competitor as well.The pay-off matrix is presented below. If firm #1 announces they will offer a warranty regardless of what firm #2 does,is this a credible threat? Why or why not?

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. -In the game in Scenario 13.17,who moves first?

In the game in Scenario 13.14,each firm has a strategy that would not be chosen under any circumstances.This strategy is

When,in the game in Scenario 13.14,the strategy that would not be chosen under any circumstances is removed,what is left is a