Suppose that, in a sequential game, the first player chooses the strategy with the highest payoff, taking into account an optimal response from the second player. The outcome that results is
a. a Nash equilibrium.
b. Pareto optimal.
c. a Prisoners' Dilemma.
d. a Stackelberg equilibrium.
d. a Stackelberg equilibrium.
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Technological change allows perfectly competitive firms to ________ and leads to ________
A) lower their costs; lower prices for consumers B) raise their prices; higher prices for consumers C) lower their costs; higher prices so the firms can earn economic profits in the long run D) raise their costs; higher prices and maximum profits in the long run E) lower their costs; deadweight loss
If dividend income increases, the following does not happen
A) the consumer chooses to consume more leisure. B) the consumer chooses to consume more consumption goods. C) the budget constraint shifts to the right. D) the substitution effect exceeds the income effect.
Refer to Scenario 2.1. What is the equilibrium quantity of books sold?
A) 25 B) 50 C) 75 D) 100 E) none of the above
When a nation reduces the barriers to international trade:
A. the total value of all goods and serviced produced by the nation rises. B. the total value of all goods and services produced by the nation falls. C. each individual citizen becomes better off. D. each individual citizen becomes worse off.