In experiments testing game theory, cheap talk does not affect the outcome of a game.
Answer the following statement true (T) or false (F)
False
Although in standard game theory cheap talk has no effect, in experiments cheap talk has been shown to be a way to induce individuals to coordinate their actions and establish trust.
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Industria and Agraria are two neighboring countries. Suppose Good X is the only good produced in both the countries and is a function of physical capital and efficiency units of labor
It is found that a one unit increase in capital leads to a higher increase in the production of Good X in Agraria than in Industria. What is the reason behind this if the number of efficiency units of labor in both the countries are equal?
What is outlet bias?
A) the tendency for the quality of products to improve over time even though the CPI does not measure changes in quality B) the tendency for households to spend their money at discount stores as prices rise C) the tendency for consumers to purchase newer, more technologically advanced products even though they have higher prices D) the tendency for households to spend more money over time
Credit cards
A) make it easy for people to borrow funds at a low rate of interest. B) are just like money because funds can be used to purchase things up to the credit limit. C) can help you get more from your money because they make it possible for you to spend more than you earn. D) make it easy for people to run up sizeable debt.
The demand curve for money:
A. shows the amount of money balances that individuals and businesses wish to hold at various levels of private investment. B. reflects the open market operations policy of the Federal Reserve. C. shows the amount of money that households and businesses wish to hold at various rates of interest. D. indicates the amount that consumers wish to borrow at a given interest rate.