Question 1

The following game:

Accepted Answer

A)  has no mixed-strategy equilibria. 
B)  has a mixed-strategy equilibrium in which Row plays Up with 0.5 probability and Down with 0.5 probability. 
C)  has a mixed-strategy equilibrium in which Column plays Left with 0.5 probability and Right with 0.5 probability. 
D)  has a mixed-strategy equilibrium in which answers B and C both hold. 
A)  has no mixed-strategy equilibria. 
B)  has a mixed-strategy equilibrium in which Row plays Up with 0.5 probability and Down with 0.5 probability. 
C)  has a mixed-strategy equilibrium in which Column plays Left with 0.5 probability and Right with 0.5 probability. 
D)  has a mixed-strategy equilibrium in which answers B and C both hold.

Question 2

Use the following to answer questions 19-20:
Table 12.12  
-(Table 12.12) The payoffs are profits in millions of dollars. The Nash equilibrium of this game is:

Accepted Answer

A)  (20 , 20). 
B)  (8 , 8). 
C)  (-20 , 15). 
D)  (-1 , 10). 
A)  (20 , 20). 
B)  (8 , 8). 
C)  (-20 , 15). 
D)  (-1 , 10).

Question 3

Which of the following statements is (are) TRUE?

Accepted Answer

A)  I and II 
B)  I, II, and III 
C)  I and III 
D)  III 
A)  I and II 
B)  I, II, and III 
C)  I and III 
D)  III

Question 4

Use the following to answer question:
Table 12.31  
-(Table 12.31)

Accepted Answer

a. Both firms expand output.
b. In the s

Question 5

Use the following to answer question:
Table 12.18  
-(Table 12.18) The payoffs represent profits measured in thousands of dollars. In this infinitely repeated game, the two schools agree to cooperate and not offer financial aid. Each school follows a grim trigger strategy. At what value of d is the Motor City Art School indifferent between upholding and cheating on the agreement?

Accepted Answer

A)  0.5 
B)  0.7 
C)  0.75 
D)  0.9 
A)  0.5 
B)  0.7 
C)  0.75 
D)  0.9

Question 6

Construct the decision tree for the following game. There are two players; each may choose 1, 2, or 3 straws at each turn. The game begins with a total of 5 straws. The object of the game is to take the last straw or straws. Assume that a player either wins $1 or loses $1. Find all Nash equilibria.

Accepted Answer

The key to constructing this game tree i

Question 7

Use the following to answer question:
Table 12.22  
-(Table 12.22) Payoffs, represent profits in millions of dollars. In this simultaneous game, TriStar and New Line Cinema both decide the genre of their summer movie release. TriStar prefers to release a superhero movie and New Line Cinema releases a comedy. TriStar enters into an irrevocable contract that will provide penalty payments to theater chains if it releases a summer comedy. These penalty payments serve as a credible commitment to TriStar's desire to release a superhero movie. How large do these penalty payments have to be to convince New Line Cinema that TriStar will release a superhero movie?

Accepted Answer

A)  between $1 million and $5 million 
B)  greater than $5 million 
C)  at least $90 million 
D)  less than $95 million 
A)  between $1 million and $5 million 
B)  greater than $5 million 
C)  at least $90 million 
D)  less than $95 million

Question 8

Suppose that you are playing an infinitely repeated game. You and your opponent agree to restrict output each period to maximize discounted profit. For each period, you and your opponent have to touch a button on a computer screen that selects the level of output, namely, restricted or unrestricted output. Once the button is touched, the output is locked in for the period and cannot be changed. If your opponent has a shaky hand, would you rather use a grim trigger strategy or a tit-for-tat strategy?

Accepted Answer

The reason to use a grim trigger strateg

Question 9

Use the following to answer questions 13-14:
Table 12.7  
-(Table 12.7) Payoffs represent profits in millions of dollars. The Nash equilibrium:

Accepted Answer

A)  does not exist. 
B)  occurs when both firms choose small expansion. 
C)  occurs when both firms choose large expansion. 
D)  occurs when both firms choose no expansion. 
A)  does not exist. 
B)  occurs when both firms choose small expansion. 
C)  occurs when both firms choose large expansion. 
D)  occurs when both firms choose no expansion.

Question 10

Which of the following is (are) the elements of every game?

Accepted Answer

A)  I, II, III, and IV 
B)  I, II, and III 
C)  IV 
D)  I and II 
A)  I, II, III, and IV 
B)  I, II, and III 
C)  IV 
D)  I and II

Question 11

Use the following to answer question:
Table 12.2  
-(Table 12.2) Thelma and Louise have been arrested for a crime. In this simultaneous game, the payoffs represent years in jail. Louise's dominated strategy is ______ while Thelma's dominated strategy is _________.

Accepted Answer

A)  Confess; Deny 
B)  Deny; Deny 
C)  Deny; Confess 
D)  Confess; Confess 
A)  Confess; Deny 
B)  Deny; Deny 
C)  Deny; Confess 
D)  Confess; Confess

Question 12

Suppose that in a two-player game player A can move Up or Down, and player B can choose Left or Right. Payoffs for this game are given in the table.   a. What are the pure-strategy Nash equilibria if any?
b. What is the mixed-strategy Nash equilibrium?

Accepted Answer

a. By the check method: @#IMG-DLM& There are no pu

Question 13

Use the following to answer question:
Table 12.25  
-(Table 12.25) Payoffs represent profits in millions of dollars.

Accepted Answer

a. Right
b

Question 14

Use the following to answer question:
Table 12.14  
-(Table 12.14) The payoffs represent profits in millions of dollars. Suppose that this simultaneous-move game is played once in each period for 3 periods. In period 1, the outcome will be _____, and in period 2, the outcome will be _____.

Accepted Answer

A)  (6 , 6); (4 , 4) 
B)  (4 , 4); (4 , 4) 
C)  (2 , 7); (6 , 6) 
D)  (6 , 6); (6 , 6) 
A)  (6 , 6); (4 , 4) 
B)  (4 , 4); (4 , 4) 
C)  (2 , 7); (6 , 6) 
D)  (6 , 6); (6 , 6)

Question 15

The following game has a mixed-strategy equilibrium in which Row plays Up with probability _____ and Column plays Left with probability _____.

Accepted Answer

A)  1/3; 2/3 
B)  2/3; 1/3 
C)  2/3; 2/3 
D)  1/3; 1/3 
A)  1/3; 2/3 
B)  2/3; 1/3 
C)  2/3; 2/3 
D)  1/3; 1/3

Question 16

Which of the following statements about mixed strategies is FALSE?

Accepted Answer

A)  They enable the player to randomize her actions. 
B)  They always exist in an equilibrium when there are at least two pure-strategy equilibria in a game. 
C)  They always involve some positive probability on every available strategy. 
D)  They can exist in equilibrium in games that do not have any pure-strategy equilibria. 
A)  They enable the player to randomize her actions. 
B)  They always exist in an equilibrium when there are at least two pure-strategy equilibria in a game. 
C)  They always involve some positive probability on every available strategy. 
D)  They can exist in equilibrium in games that do not have any pure-strategy equilibria.

The following game:

Use the following to answer questions 19-20: Table 12.12 -(Table 12.12) The payoffs are profits in millions of dollars. The Nash equilibrium of this game is:

Which of the following statements is (are) TRUE?

Use the following to answer question: Table 12.31 -(Table 12.31)

Construct the decision tree for the following game. There are two players; each may choose 1, 2, or 3 straws at each turn. The game begins with a total of 5 straws. The object of the game is to take the last straw or straws. Assume that a player either wins $1 or loses $1. Find all Nash equilibria.

Use the following to answer questions 13-14: Table 12.7 -(Table 12.7) Payoffs represent profits in millions of dollars. The Nash equilibrium:

Which of the following is (are) the elements of every game?

Use the following to answer question: Table 12.2 -(Table 12.2) Thelma and Louise have been arrested for a crime. In this simultaneous game, the payoffs represent years in jail. Louise's dominated strategy is while Thelma's dominated strategy is ___.

Suppose that in a two-player game player A can move Up or Down, and player B can choose Left or Right. Payoffs for this game are given in the table. a. What are the pure-strategy Nash equilibria if any? b. What is the mixed-strategy Nash equilibrium?

Use the following to answer question: Table 12.25 -(Table 12.25) Payoffs represent profits in millions of dollars.

Use the following to answer question: Table 12.14 -(Table 12.14) The payoffs represent profits in millions of dollars. Suppose that this simultaneous-move game is played once in each period for 3 periods. In period 1, the outcome will be _, and in period 2, the outcome will be _.

The following game has a mixed-strategy equilibrium in which Row plays Up with probability _ and Column plays Left with probability _.

Which of the following statements about mixed strategies is FALSE?

Supply and Demand

Using Supply and Demand to Analyze Markets

Consumer Behavior

Individual and Market Demand

Producer Behavior

Costs

Supply in a Competitive Market

Market Power and Monopoly

Market Power and Pricing Strategies

Imperfect Competition

Factor Markets

Investment, Time, and Insurance

General Equilibrium

Asymmetric Information

Externalities and Public Goods

Behavioral and Experimental Economics

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Exam 12: Game Theory

The following game:

Use the following to answer questions 19-20: Table 12.12 -(Table 12.12) The payoffs are profits in millions of dollars. The Nash equilibrium of this game is:

Which of the following statements is (are) TRUE?

Use the following to answer question: Table 12.31 -(Table 12.31)

Construct the decision tree for the following game. There are two players; each may choose 1, 2, or 3 straws at each turn. The game begins with a total of 5 straws. The object of the game is to take the last straw or straws. Assume that a player either wins $1 or loses $1. Find all Nash equilibria.

Use the following to answer questions 13-14: Table 12.7 -(Table 12.7) Payoffs represent profits in millions of dollars. The Nash equilibrium:

Which of the following is (are) the elements of every game?

Use the following to answer question: Table 12.2 -(Table 12.2) Thelma and Louise have been arrested for a crime. In this simultaneous game, the payoffs represent years in jail. Louise's dominated strategy is ______ while Thelma's dominated strategy is _________.

Suppose that in a two-player game player A can move Up or Down, and player B can choose Left or Right. Payoffs for this game are given in the table. a. What are the pure-strategy Nash equilibria if any? b. What is the mixed-strategy Nash equilibrium?

Use the following to answer question: Table 12.25 -(Table 12.25) Payoffs represent profits in millions of dollars.

Use the following to answer question: Table 12.14 -(Table 12.14) The payoffs represent profits in millions of dollars. Suppose that this simultaneous-move game is played once in each period for 3 periods. In period 1, the outcome will be _____, and in period 2, the outcome will be _____.

The following game has a mixed-strategy equilibrium in which Row plays Up with probability _____ and Column plays Left with probability _____.

Which of the following statements about mixed strategies is FALSE?

Supply and Demand

Using Supply and Demand to Analyze Markets

Consumer Behavior

Individual and Market Demand

Producer Behavior

Costs

Supply in a Competitive Market

Market Power and Monopoly

Market Power and Pricing Strategies

Imperfect Competition

Factor Markets

Investment, Time, and Insurance

General Equilibrium

Asymmetric Information

Externalities and Public Goods

Behavioral and Experimental Economics

Filters

Use the following to answer question: Table 12.2 -(Table 12.2) Thelma and Louise have been arrested for a crime. In this simultaneous game, the payoffs represent years in jail. Louise's dominated strategy is while Thelma's dominated strategy is ___.

Use the following to answer question: Table 12.14 -(Table 12.14) The payoffs represent profits in millions of dollars. Suppose that this simultaneous-move game is played once in each period for 3 periods. In period 1, the outcome will be _, and in period 2, the outcome will be _.

The following game has a mixed-strategy equilibrium in which Row plays Up with probability _ and Column plays Left with probability _.