The reason that the prisoner's dilemma presents a dilemma is that:
A. each player has an incentive to play his or her dominant strategy, but when both choose the dominant strategy each player has a lower payoff than if they both had chosen the dominated strategy.
B. each player has an incentive to play his or her dominated strategy, but when both choose the dominated strategy each player has a lower payoff than if they both had chosen the dominant strategy.
C. neither player has a comparative advantage, so neither can infer what the other player will choose.
D. the market cannot be in equilibrium because the players do not have dominant strategies.
Answer: A
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When the percentage change in the quantity supplied is twice the percentage change in price, then supply is
A) elastic. B) inelastic. C) unit elastic. D) perfectly inelastic. E) perfectly elastic.
A consumer's budget line for food (F) and shelter (S) is represented as F = 250 - 5S. If this consumer's income increases by $10 and consumption of shelter remains unchanged, how many more units of shelter can be purchased at most?
A) 10 B) 20 C) 50 D) 2
Economists consider instances of increasing marginal utility to be
a. normal. b. impossible. c. unusual, as in the case of addictions. d. irrational.
If adopted by a firm, a labor-augmenting piece of technology is one that would:
A. increase labor supply. B. decrease labor demand. C. decrease labor supply. D. increase labor demand.