Refer to Figure 3.3. Based on the information in the above payoff matrix, identify each player's dominant strategy (if there is one) and the location of the Nash equilibrium
What will be an ideal response?
Luke's dominant strategy is playing Down and Hudson's dominant strategy is playing Right. The Nash equilibrium is where Luke plays Down and Hudson plays Right, so each player is playing his dominant strategy.
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Player 1 and Player 2 are playing a game in which Player 1 has the first move at A in the decision tree shown below. Once Player 1 has chosen either Up or Down, Player 2, who can see what Player 1 has chosen, must choose Up or Down at B or C. Both players know the payoffs at the end of each branch. 
What is the equilibrium outcome of this game?
A. Player 1 chooses Up and Player 2 chooses Down. B. Player 1 chooses Down and Player 2 chooses Up. C. Player 1 and Player 2 both choose Down. D. Player 1 and Player 2 both choose Up.
In the figure above, the poorest 40 percent of households receive ________ of total income
A) 20 percent B) 10 percent C) 30 percent D) 15 percent
In the short-run, an increase in government purchases will cause
A) a shift of the DD curve to the left and an increase in output. B) a shift of the DD curve to the right and a decrease in output. C) a shift of the DD curve to the left and a decrease in output. D) a shift of the DD curve to the right and an increase in output. E) a shift of the DD curve the left and an appreciation of the currency.
Which of the following is an unintended side effect of protectionist policies to protect domestic jobs?
a. The consumers are paying higher prices to the protected industry, so they will purchase less product from that industry, and jobs are lost in the protected industry. b. The protected product is sold to other firms, who must now pay a higher price for a key input, so those firms will lose sales to foreign producers who do not need to pay the higher price. c. The protected product is sold to other firms, who must now pay a higher price for a key input, so those firms will increase sales from foreign producers. d. The consumers are paying higher prices to the protected industry, so they will purchase more products from unprotected industries, and jobs are gained in the unprotected industry.