4. Game theory:
A. is the analysis of how people (or firms) behave in strategic situations.
B. is best suited for analyzing purely competitive markets.
C. reveals that mergers between rival firms are self-defeating.
D. reveals that price-fixing among firms reduces profits.

Question

4.    Game theory:
A.    is the analysis of how people (or firms) behave in strategic situations.
B.    is best suited for analyzing purely competitive markets.
C.    reveals that mergers between rival firms are self-defeating.
D.    reveals that price-fixing among firms reduces profits.

BlackTom AI · Accepted Answer

The question concerns game theory and asks which statement is true about it.
Option A: 'is the analysis of how people (or firms) behave in strategic situations.' This is accurate because game theory studies strategic interactions where the outcome for each participant depends on the actions of others, including behavior of individuals and firms in competitive settings.
Option B: 'is best suited for analyzing purely competitive markets.' This is not correct. Game theory is particularly powerful for strategic settings with interdependencies, such as oligopolies or markets with few players, where strategic choices matter; it is not limited to purely competitive (perfect competition) markets.
Option C: 'reveals that mergers between rival firms are self-defeating.' This is an overstatement. Game theory can show conditions under which mergers improve or harm payoffs, depending on strategic complementarities, market structure, and incentives; it does not universally declare mergers self-defeating.
Option D: 'reveals that price-fixing among firms reduces profits.' While price-fixing can reduce consumer welfare and may be illegal, game-theoretic models can yield various outcomes depending on enforcement, collusion stability, and market dynamics. It is not an absolute general finding that price-fixing always reduces profits in all contexts.
In summary, Option A correctly captures the core idea of game theory as the study of strategic behavior in interdependent situations, while the other options either overgeneralize or misstate the scope or implications of game-theoretic analysis.

ECNM1116.32925.202530 Practice Quiz Oligopoly and Strategic Behavior

4. Game theory: A. is the analysis of how people (or firms) behave in strategic situations. B. is best suited for analyzing purely competitive markets. C. reveals that mergers between rival firms are self-defeating. D. reveals that price-fixing among firms reduces profits.

查看解析

登录即可查看完整答案

类似问题

Consider the game described by the following payoff matrix. Which of the following statements is TRUE? Player 2 Left Middle Right Player 1 Top 25, 30 16, 32 30, 23 Center 34, 43 18, 23 35, 12 Bottom 43, 15 21, 33 36, 38

Consider the game described by the following payoff matrix. Which of the following statements is TRUE? Player 2 Left Middle Right Player 1 Top 25, 30 16, 32 30, 23 Center 34, 43 18, 23 35, 12 Bottom 43, 15 21, 33 36, 38

Consider the following game: Player B Accept Reject Accept 5, 6 13, 3 Player A Reject 7, 5 8, 4 What is the maximum A is willing to offer to B if it plays Reject? (Note: if it must be less than 10, enter 10)

Consider the following game. Player B Accept Reject Accept 5, 7 13, X Player A Reject 7, 9 X, 6 What should be the minimum possible value of X for this game to be a Coordination Game? (Note: if it must be higher than 10, enter 10)

In the Prisoner’s Dilemma, whatever choice the other guy makes, the payoff for you is to always [ Select ] Cooperate Defect

The table below is not a game in strategic form because the payoffs should be different for the different actions U and D. [table] U | (1,1) | (0,0) D | (0,0) | (0,0) [/table]

In a two-player strategic form game there are two numbers at each entry in the payoff matrix. The first of these numbers is usually the payoff of the column player.

更多留学生实用工具

考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单