Question : 11) Your neighbor’s 10-year old son has come to your : 1377596

 

11) Your neighbor’s 10-year old son has come to your house to collect money for a relief-fund for hurricane victims. You were initially unwilling to contribute but agreed to give when you came to know that he has already collected money from all your neighbors. This is an example of ________.

A) pure altruism

B) impure altruism

C) liberalism

D) rationalism

12) ________, in economics, refers to a preference for equal outcomes within the target population.

A) Randomness

B) Rationalism

C) Fairness

D) Liberalism

13) A Nash equilibrium occurs when ________.

A) each player has a dominant strategy

B) none of the players has a dominant strategy

C) each player can increase his payoff by choosing a different strategy

D) none of the players can increase their payoffs by choosing a different strategy

Catherine and Arthur are playing a game. They are put in two different rooms and asked to choose between two colors-black or white. If they both choose black, they will not get any money. If they both choose white, each of them will get $5. If one choses white while the other chooses black, the one who choses black will get $10 and the one who chooses white will get $0.

 

14) Refer to the scenario above. Which of the following is true in this case?

A) This game does not have a dominant strategy equilibrium.

B) This game does not have a Nash equilibrium.

C) This game has multiple Nash equilibria.

D) This game has a unique Nash equilibrium.

15) Refer to the scenario above. What will be the outcome of this game?

A) Both players will choose black.

B) Both players will choose white.

C) Arthur will choose white and Catherine will choose black.

D) Catherine will choose white and Arthur will choose black.

16) Refer to the scenario above. If the players have to pay a fairness penalty of $6, ________.

A) the game will not have a Nash equilibrium

B) the game will have multiple Nash equilibria

C) the game will have multiple dominant strategy equilibria

D) the game will have a unique Nash equilibrium

Roger and Billy are two colleagues who were caught by their boss for forging an important document together and have been taken to separate rooms for interrogation. They are told that if both of them confess their crime, they will be charged a fine of $2,000. If none of them confesses, they will be fined $1,000 each. However, if one of them confesses while the other does not, the one who confesses will be set free but the other will be fined $3,000.

 

17) Refer to the scenario above. Which of the following is true in this case?

A) This game does not have a dominant strategy equilibrium.

B) This game does not have a Nash equilibrium.

C) Roger’s dominant strategy is to deny the crime.

D) This game has a unique Nash equilibrium.

18) Refer to the scenario above. In equilibrium, ________.

A) both colleagues will confess

B) both colleagues will deny the crime

C) Roger will confess while Billy will deny

D) Billy will confess while Roger will deny

19) Refer to the scenario above. If the colleagues had decided on a fairness penalty of $5,000 before committing the crime, ________.

A) this game will not have a Nash equilibrium

B) this game will have multiple Nash equilibria

C) this game will have multiple dominant strategy equilibria

D) this game will have a unique Nash equilibrium

 

 

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