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Chapter 10, Additional Questions
Q1.
A dominant strategy occurs when
A) one player has a strategy that yields the highest payoff independent of the other
player's choice.
B) both players have a strategy that yields the highest payoff independent of the
other's choice.
C) both players make the same choice.
D) the payoff to a strategy depends on the choice made by the other player.
E) each player has a single strategy.
Q2.
The prisoner's dilemma refers to games where
A)
B)
C)
D)
E)
neither player has a dominant strategy.
one player has a dominant strategy and the other does not.
both players have a dominant strategy.
both players have a dominant strategy which results in the largest possible payoff.
both players have a dominant strategy which results in a lower payoff than their
dominated strategies.
Q3. The payoff matrix shows the utilities from seeing Comedy or Documentary.
Jordan
Comedy
Comedy
Lee
Documentary
a)
B) 1. C) 2. D) 3.
E) 4.
By allowing for a timing element in this game, i.e., letting either Jordan or Lee buy a
ticket first and then letting the other choose second, assuming self-interested players,
the equilibrium is __________, based on __________.
A)
B)
C)
D)
E)
Q4.
Documentary
Lee: 1
Jordan: 1
Lee: 5
Jordan: 3
This game has __________ Nash equilibrium.
A) 0.
b)
Lee: 3
Jordan: 5
Lee: 2
Jordan: 2
still uncertain; who buys the second ticket
now determinant; who buys the first ticket
now determinant; who buys the second ticket
still uncertain; who buys the first ticket
now determinant; who is more cooperative
A commitment problem exists when
A)
B)
C)
D)
E)
players cannot make credible threats or promises.
players cannot make threats.
there is a prisoner's dilemma.
players cannot make promises.
players are playing games in which timing does not matter.
Use the following to answer questions Q5:
In the above decision tree, Matthew picks first and Dean picks second. Matthew knows
Dean's payoffs to each choice and Dean knows Matthew's payoffs.
Q5.
Suppose Dean promises Mathew that he will always select the upper branch of either
Y or Z. If Mathew believes Dean and Dean does in fact keep his promise, the
outcome of the game is
A)
B)
C)
D)
E)
unpredictable.
Mathew and Dean both get $1,000.
Mathew gets $500 and Dean gets $1,500.
Mathew gets $1.5 million and Dean gets $1 million.
Mathew gets $400 and Dean gets $1.5 million.