Consider a two-person, two-strategy game in which only pure strategies are played. Such a game must have at least one
a. Nash equilibrium.
b. player with a dominant strategy.
c. Pareto-optimal outcome.
d. outcome that is both a Nash equilibrium and Pareto optimal.
c. Pareto-optimal outcome.
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Unions face a trade-off between higher wages and
A) fewer available positions. B) more available positions. C) equipment. D) none of the above.
The balanced budget multiplier is equal to
a. 1/(1 – MPC) b. 1/(1 – MPC) + –MPC/(1 – MPC) c. MPC/(1 – MPC) d. (1 – MPC)/MPC e. 2
Amy can produce either 5,000 pounds of cheese or 20 cars per year. Mike can produce either 5,000 pounds of cheese or 10 cars per year. By the principle of comparative advantage, Mike should specialize in producing
A. cars. B. cheese. C. both cheese and cars. D. neither cheese nor cars.
In the Kyoto Protocol, participating nations agreed to
A) trade carbon-dioxide permits. B) eliminate all emissions of greenhouse gases by 2020. C) reduce their overall emissions of greenhouse gases between 1997 and 2020 to as much as 20 percent below 1990 levels. D) buy greenhouse gas emission permits from developing nations.