This figure shows the payoffs involved when Sarah and Joe work on a school project together for a single grade. They both will enjoy a higher grade when more effort is put into the project, but they also get pleasure from goofing off and not working on the project. The payoffs can be thought of as the utility each would get from the effort they individually put forth and the grade they jointly receive.The game in the figure shown is a version of:
A. a cooperative game.
B. an ultimatum.
C. a simultaneous game.
D. a sequential game.
Answer: C
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In an open economy, the domestic real interest rate is determined by:
A. domestic saving and domestic investment. B. domestic investment. C. domestic saving, domestic investment, and net capital inflows. D. domestic saving and net capital inflows.
The CPI in 2010 was 218, while the CPI in 1980 was 82. If you had $5,000 in 1980, its equivalent purchasing power in 2008 would be $10,850
Indicate whether the statement is true or false
If the MRP per dollar is greater for labor than that for tools, a producer should spend more money on labor than originally planned and less on tools. How long can he continue this switch in spending? Why?
What will be an ideal response?
Suppose an astronomer discovers gold on the moon. Would this gold add to the world reserves?
A) Yes, we know it exists and we could recover it. B) No, we know it exists but we can't extract the gold. C) No, there are no established property rights over the moon so they cannot add to world reserves. D) Yes, but only if the astronomer is the resident of a developed country with well-established property rights.