In game theory, we usually assume that all players
A) act rationally.
B) use the information available to them to decide on a best strategy.
C) know about the payoffs of the other players.
D) All of the above.
D
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Full employment describes the condition in which
a. 100 percent of the civilian labor force is employed. b. 95 to 96 percent of the civilian labor force is employed. c. there is no frictional unemployment. d. unemployment is 10 percent or less.
Prospect theory was proposed by:
A. John Nash. B. Milton Friedman and George Stigler. C. Amos Tversky and Daniel Kahneman. D. Gary Becker.
If a Japanese pension fund decides to purchase U.S. government bonds, what is the effect in the exchange market? a. It will increase the supply of U.S. dollars
b. It will decrease the supply of U.S. dollars. c. It will increase the demand for U.S. dollars. d. It will decrease the demand for U.S. dollars.
The average of the bilateral rate changes for a nation, weighted by the importance of the trading partner, is known as the:
a. real exchange rate. b. nominal exchange rate. c. effective exchange rate. d. direct exchange rate.