Exam 14: Game Theory and the Economics of Information

The table given below represents the payoff matrix of firms A and B,when they choose to produce low or high output.In each cell,the figure on the left indicates Firm B's payoffs and the figure on the right indicates Firm A's payoffs. -The information in Table 14-2 implies that the game has:

Hannah is willing to pay at least $850 and at most $1,000 for a new dishwasher.She goes to the various electronic stores in her neighborhood to compare the prices and the product features that differentiate one brand from the other.Which of the following can be categorized as Hannah's search cost?

In an oligopoly game,the incentive to cheat is reduced when:

A representation of how each combination of choices affects the profits of each player is known as a:

Which of the following is likely to result from successful advertising?

The table given below represents the payoff matrix of firms A and B,when they choose to produce low or high output.In each cell,the figure on the left indicates Firm B's payoffs and the figure on the right indicates Firm A's payoffs. -Given the information in Table 14-2,which of the following can be concluded about the strategies of the two firms?

A Nash equilibrium occurs when:

Under which of the following game theory circumstances is a collusive outcome most likely?

Which of the following is the best explains the moral hazard problem?

The table given below shows the payoffs to Firm A and Firm B if they choose to produce either high output or low output.In each cell,the figure on the left indicates Firm A's payoffs and the figure on the right indicates Firm B's payoffs. -Refer to the payoff matrix in Table 14-1.Which of the following describes the dominant-strategy equilibrium in this game?

Explain how advertising,when undertaken by all competing firms,actually reduces the market power of the firms.

In economics,the term "lemon" is used to describe:

Moral hazard describes a situation in which:

Consider a duopoly market where the players agree to collude.The single-period prisoner's dilemma game applied to this market generally predicts that:

The view that advertising serves as a source of information suggests that advertising is:

An analysis of the relationship between advertising and price indicates that advertising:

What is a prisoner's dilemma? Draw a payoff matrix which illustrates this game.

Which of the following statements is true of Nash equilibrium?

If a firm is better off with a particular strategy regardless of what the other firm does,then it is called the firm's:

Which of the following,if true,would allow oligopolists to enjoy greater profits through collusion?