Answer the following statement(s) true (T) or false (F)
1. The Battle of the Sexes game has two Nash equilibria, neither of which is Pareto optimal.
2. All outcomes in the Copycat Game are Nash equilibria.
3. A solution concept is any way of analyzing a game which leads to the discovery of a Nash equilibrium which solves the game.
4. The concept of Nash Equilibrium is an important solution concept because it helps make predictions.
5. When a game has more than one Nash equilibrium, it is unlikely that a stable equilibrium will ever be reached.
1. True
2. False
3. False
4. True
5. False
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The real interest rate is negative if the inflation rate
A) equals zero. B) is less than the nominal interest rate. C) exceeds the nominal interest rate. D) is equal to the nominal interest rate. E) exceeds the real interest rate.
Banks create money by
A) printing currency. B) asking the Fed to print more currency. C) lending to the Fed. D) making loans. E) buying government securities.
Commercial paper is most commonly issued with a maturity of __________ days
A) 5 B) 10 C) 30 D) 270
A sudden decrease in the market demand in a competitive industry leads to
a. A market equilibrium price higher than the original equilibrium in the short-run b. A market equilibrium price equal to the original equilibrium in the long-run c. Both a and b d. None of the above