Question :
Introduction
1) ________ the economic framework that describes an individual’s optimal : 1377505
Introduction
1) ________ is the economic framework that describes an individual’s optimal actions in settings where interactions with others determine her well-being.
A) Game theory
B) Econometrics
C) The Keynesian Cross
D) The IS-LM model
2) Game theory is the study of ________.
A) policy analysis
B) strategic interactions
C) program evaluation
D) irrational decision making
3) Which branch of study helps in economic decision making when an individual’s behavior determines the payoffs to others?
A) Microeconomics
B) Macroeconomics
C) Game theory
D) Public economics
4) Which of the following is likely to use the concepts of game theory?
A) Determining the profit-maximizing output of a monopolist
B) Exit decision of competitive firms in the long run
C) Pricing decision of a firm operating in an industry comprising two firms
D) Determining the wage rate in a competitive labor market
13.1 Simultaneous Move Games
1) A ________ is a complete plan describing how a player will act.
A) strategy
B) payoff
C) hypothesis
D) policy
2) A payoff matrix shows ________.
A) the various combinations of inputs required to produce a good
B) the return from each action that players can take in a game
C) the different combinations of two goods that can be bought with a given income
D) the payment made to each factor of production for the production of a good
3) Which of the following is true of a payoff matrix?
A) It is the representation of only the best response of each player.
B) It takes into account all relevant costs and benefits associated with each action of the players.
C) It shows the payment made to each factor of production for the production of a good.
D) It does not represent all the costs and benefits associated with the choices of the players.
4) A game is called a simultaneous move game if ________.
A) players chose their actions at the same time
B) one player choses her action after the other player makes a move
C) players chose mixed strategies to play the game
D) players chose their dominant strategies to play the game
5) Which of the following is true of a simultaneous move game?
A) Players chose their actions after knowing the action of the first player.
B) All relevant benefits and costs of each action are taken into account.
C) It involves strategic interactions among a large number of players.
D) This game cannot be represented by a payoff matrix.
6) In a simultaneous move game, ________.
A) each player has to make his choice after knowing his rival’s choice
B) each player has to make his choice without knowing his rival’s choice
C) there is always more than one Nash equilibrium
D) there is always more than one dominant strategy equilibrium
7) The “prisoners’ dilemma” is an example of a(n) ________ game.
A) simultaneous move
B) extensive-form
C) zero-sum
D) mixed strategy
8) A best response is ________.
A) one player’s optimal action choice irrespective of the action of the other player
B) one player’s optimal action choice taking the other player’s action as given
C) an action choice that always results in a zero payoff to the opponent
D) an action choice that results in equal payoffs to all the players in a game
