Identify the choice that best completes the statement or answers the question.
This table shows a game played between two players, A and B. The payoffs in the table are shown as (Payoff to A, Payoff to B).
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B
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Right
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Left
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A
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Up
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(2, 2)
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(3, 1)
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Down
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(1, 3)
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(0, 0)
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____ 1. Refer to Table. If player A chooses his/her best strategy, player B should
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a.
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choose right and earn a payoff of 2.
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b.
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choose right and earn a payoff of 3.
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c.
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choose left and earn a payoff of 1.
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d.
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choose left and earn a payoff of 0.
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____ 2. Refer to Table. If both players choose their best strategies, player A will earn a payoff of
____ 3. Refer to Table. Which of the following statements about this game is true?
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a.
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Up is a dominant strategy for A and Right is a dominant strategy for B.
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b.
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Up is a dominant strategy for A and Left is a dominant strategy for B.
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c.
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Down is a dominant strategy for A and Right is a dominant strategy for B.
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d.
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Down is a dominant strategy for A and Left is a dominant strategy for B.
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____ 4. Refer to Table. Which outcome is the Nash equilibrium in this game?
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a.
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Up-Right
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b.
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Up-Left
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c.
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Down-Right
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d.
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Down-Left
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____ 5. In general, game theory is the study of
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a.
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how people behave in strategic situations.
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b.
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how people behave when the possible actions of other people are irrelevant.
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c.
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oligopolistic markets.
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d.
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all types of markets, including competitive markets, monopolistic markets, and oligopolistic markets.
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____ 6. Game theory is important for understanding which of the following market types?
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a.
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perfectly competitive and oligopolistic markets
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b.
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perfectly competitive markets but not oligopolistic markets
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c.
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oligoplistic but not perfectly competitive markets
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d.
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neither oligopolistic nor perfectly competitive markets.
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