Exam 8: Game Theory and Oligopoly

Jet Cruises wants to prevent Easy Sail from entering the sailboat market. The above game tree illustrates the different strategi corresponding payoffs for the two firms. Both Jet Cruises and Easy Sail have the same strategies of advertising (Ad) or not ad (No Ad). The payoffs represent net profit in millions. -If Jet Cruises chooses to Ad and Easy Sail then chooses to Ad, Jet Cruises earns million in net profit and Easy Sail earns million.

All of the following are examples of a sequential game except which one?

Jet Cruises wants to prevent Easy Sail from entering the sailboat market. The above game tree illustrates the different strategi corresponding payoffs for the two firms. Both Jet Cruises and Easy Sail have the same strategies of advertising (Ad) or not ad (No Ad). The payoffs represent net profit in millions. -If Jet Cruises chooses to No Ad, Easy Sail should and earn million in net profit.

The manager of a large luxury hotel chain is currently negotiating a four year contract with a linens supplier. The linens company will supply fresh laundered bedding and towels to the hotel over a four year period; however, the hotel chain can ends its contract with the linens company at the end of the first, second, or third years if the linens company does not supply quality linens. What can the manager of the hotel chain do to avoid the end- game problem?

The likelihood of a rival's announcement of a planned strategy being truthful depends on the degree to which it's interests align with its rivals.

In a game with multiple Nash equilibria, all of the following can be used to determine the equilibrium of the game except which one?

Jet Cruises wants to prevent Easy Sail from entering the sailboat market. The above game tree illustrates the different strategi corresponding payoffs for the two firms. Both Jet Cruises and Easy Sail have the same strategies of advertising (Ad) or not ad (No Ad). The payoffs represent net profit in millions. -The Nash equilibrium of this game is for Jet Cruises to and Easy Sail to .

-Refer to the payoff matrix above. Which of the following is the dominant strategy equilibrium?

-Refer to the payoff matrix above. Which of the following is true for Bright Lights?

If Big Sails and Jet Sails are two competing sailboat firms and Big Sails wants to make a threat to Jet Sails more credible, they can do all of the following except which one?

Jet Cruises wants to prevent Easy Sail from entering the sailboat market. The above game tree illustrates the different strategi corresponding payoffs for the two firms. Both Jet Cruises and Easy Sail have the same strategies of advertising (Ad) or not ad (No Ad). The payoffs represent net profit in millions. -If Jet Cruises chooses to Ad and Easy Sail then chooses to No Ad, Jet Cruises earns million in net profit and Easy Sail earns million.

If Firm A and Firm B are playing a finitely repeated game in which they both believe there is a 90 percent chance that the game will continue each period, all of the following are true except which one?

Happy Feet wants to prevent Best Nails from entering the nail salon market. The above game tree illustrates the different stra and corresponding payoffs for the two firms. Both Happy Feet and Best Nails have the same strategies of advertising (Ad) or advertising (No Ad). The payoffs represent net profit in millions. -If Happy Feet chooses to No Ad and Best Nails then chooses to No Ad, Happy Feet earns million in net profit and Best Nails earns million.

If Happy Nails and Luxury Nails are two competing nail salons and Happy Nails wants to make a threat to Luxury Nails more credible, they can do all of the following except which one?

A manager's optimal decision regarding their firm's strategy requires that the manager also considers their rival's best response.

If Best Lights and Bright Lights are competing in a duopoly, Best Lights' profit depends solely on the decisions of its managers.

Cruise R Us and Cruise the World compete in the cruise line industry. Each firm needs to determine if they are going to offer special cruise packages with special rates or not offer the specials. The above payoff matrix shows the firms' net economic profit for each set of strategies. -Refer to the payoff matrix above. In reference to the Nash equilibrium/equilibria in this game, which of the following is true?

Camp with Us and Happy Campers compete in the market for campers. Each firm must decide each season if they are going to offer special financing or not. The above payoff matrix shows each firm's net economic profit at each pair of strategies. -Refer to the payoff matrix above. If each cell has a probability of occurrence of 0.25, what are Happy Campers' expected profits?

Cheap talk is an example of a refinement.

Mario's Pizza and Bella's Pizza are in tacit collusion to cooperate and each charge a high price for their pizzas. If Mario's Pizza initially cooperates with Bella's Pizza, but then switches and charges a low price and Bella's Pizza responds by forever charging a low price, this is an example of ________.