14-141
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
in the case of a monopoly.
D.
oligopolies tend to engage in advertising more so than monopolies.
279.
When near-monopolies, like Google in Internet search and Amazon in online shopping,
start infringing on each other’s turf, what kind of competition results?
A.
pure competition
280.
The tablet-computer market is best characterized as a(n)
A.
pure competition.
281.
A two-player or firm game in which one firm’s gain must equal the other firm’s loss is
called a
A. positive-sum game.
282.
A two-player game in which one player’s gain is not completely offset by the other
player’s loss is called a
D.
one-time game.
283.
A game where players or firms select their optimal strategies for a single time period
without regard for possible interactions in subsequent periods is called a
A.
positive-sum game.
14-143
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
Di fficu l t y :
03 Hard
Learning Objective: 14–06 Utilize additional game-theory terminology and demonstrate
how to find Nash equilibriums in both simultaneous and sequential games.
Test Bank: II
Topic:
Game Theory and Strategic Behavior
284.
A game where players choose their strategies at the same time is called a
A.
positive-sum game.
285.
A strategy that is better than any alternative strategy—regardless of what the other firm
does—is called a
D.
one-time strategy.
286.
A dominant strategy is a player’s move or action that
14-144
D.
gives the largest total payoff for the two players combined.
287.
A game has a Nash equilibrium when the two players’ dominant strategies
A. depend on what the other player does.
288.
In game theory, a credible threat of coercion by a dominant firm tends to
D.
discourage collusive agreements.
289.
A statement of coercion by one firm is
A.
an empty threat if it is believed by the other firm.
290.
In game theory, a repeated game is one
D.
that is replicated in other parts of the market.
291.
In some games, one firm may avoid taking advantage of another firm because it knows
that the other firm can take advantage of it in subsequent games. This behavior is called
A. the first-mover advantage.
14-146
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.
how to find Nash equilibriums in both simultaneous and sequential games.
Test Bank: II
Topic:
Game Theory and Strategic Behavior
292.
In a repeated game with reciprocity, the two players
D.
often end up in a price war.
293.
Which of the following statements is true?
A.
Nash equilibriums exist only in games with dominant strategies.
294.
In some games, one player or firm moves first and commits to a strategy to which the
rival player or firm will subsequently respond.Such games are called
A.
repeated games.
295.
The so-called first-mover advantage may be observed in
A.
repeated games.
296.
A natural monopoly’s preemption of entry by other firms by exploiting its economies of
scale is an example of
C.
Nash equilibrium in a single-period game.
D.
collusion in game theory.
297.
Answer the question based on the payoff matrix for a duopoly, in which the numbers indicate
the profit from following either an international strategy or a national strategy. If firm A
chooses an international strategy while firm B chooses a national strategy, then the payoffs will
be
A.
$3M for both firms.
298.
Answer the question based on the payoff matrix for a duopoly, in which the numbers indicate
the profit from following either an international strategy or a national strategy. Which of
the
following is true?
A. The international strategy is the dominant strategy for both firms.
299.
Answer the question based on the payoff matrix for a duopoly, in which the numbers indicate
the profit from following either an international strategy or a national strategy. When this
game reaches a Nash equilibrium, the payoffs will be
A. $3M for both firms.
14-151
300.
Answer the question based on the payoff matrix for a duopoly, in which the numbers indicate
the profit from following either an international strategy or a national strategy. If firm A
chooses its dominant strategy and firm B chooses a strategy that is not dominant, then the
payoffs will be
A.
$3M for both firms.
301. Answer the question based on the payoff matrices for a repeated game involving two
firms that are considering introducing new products to the market. The numbers indicate the
profit from following either a strategy to introduce a new product or a strategy to not introduce
a new product.
14-152
First game.
Second game.
14-153
In the first game,
D.
not introducing a new product is the dominant strategy for firm A, while introducing a new
product is the dominant strategy for firm B.
302. Answer the question based on the payoff matrices for a repeated game involving two
14-154
firms that are considering introducing new products to the market. The numbers indicate the
profit from following either a strategy to introduce a new product or a strategy to not introduce
a new product.
First game.
Second game.
In the second game,
D.
not introducing a new product is the dominant strategy for firm A, while introducing a new
product is the dominant strategy for firm B.
303. Answer the question based on the payoff matrices for a repeated game involving two
firms that are considering introducing new products to the market. The numbers indicate the
14-156
profit from following either a strategy to introduce a new product or a strategy to not introduce
a new product.
First game.
Second game.