BUSINESS STRATEGY GAME ACTUAL TEST
QUESTIONS WITH VERIFIED CORRECT
ANSWERS
●● 2) A game in economics is defined as
Answer: B) competition in which strategic decision making is integral.
●● 3) A game includes
A) a strategy.
B) payoffs.
C) rules.
D) All of the above.
Answer: D) All of the above.
●● 4) In game theory, a strategy
Answer: C) defines the specific actions a firm will make.
●● 5) Common knowledge in game theory
Answer: A) is information known by all players.
,●● 6) Common knowledge in game theory
Answer: A) is information known to be known by all players.
●● 7) In a static game, firms
Answer: B) compete only once.
●● 8) A payoff matrix
Answer: C) shows the payoffs to each firm for each possible outcome.
●● 9) Which of the following is a simultaneous decision game?
Answer: D) rock-paper-scissors (Roshambo)
●● 10) Rock-paper-scissors (Roshambo) is an example of a ________
game.
Answer: A) simultaneous
●● New
11) A strategy is dominant if
Answer: B) it yields a payoff at least as large as that from any other
strategy, regardless of the actions of other players.
●● 12) Dominant strategies
,A) are always present in simultaneous games.
B) result in a prisoners' dilemma.
C) result in one firm winning and the other losing.
D) None of the above.
Answer: D) None of the above.
●● 13) A dominated strategy
Answer: C) is one that is never used by a rational actor.
●● 14) When both firms have dominant strategies
Answer: A) the outcome is called a dominant strategy solution.
●● 15) One interesting feature of a prisoner's dilemma game is that
Answer: A) non-cooperative behavior leads to lower payoffs than
cooperative behavior.
●● New
16) Mutually Assured Destruction was a standing policy during the Cold
War, in which the
United States and the USSR maintained and expanded nuclear arsenals
beyond practical levels.
What could explain such a phenomenon?
A) insane public officials who were bent on world domination
, B) a prisoner's dilemma
C) a leader-follower type game
D) tacit collusion
Answer: B
Skill: Analytical
AACSB: Analytical Thinking
●● New
5
Copyright© 2017 Pearson Education, Inc.
17) The term prisoners' dilemma refers to a game in which
A) there are no Nash equilibria.
B) there are no dominant strategies.
C) the payoff from both players playing their dominant strategies is the
same for each player.
D) the payoff from both players playing their dominant strategies is not
the highest payoff
possible.
Answer: D
Skill: Definition
AACSB: Application of Knowledge
●● Old
QUESTIONS WITH VERIFIED CORRECT
ANSWERS
●● 2) A game in economics is defined as
Answer: B) competition in which strategic decision making is integral.
●● 3) A game includes
A) a strategy.
B) payoffs.
C) rules.
D) All of the above.
Answer: D) All of the above.
●● 4) In game theory, a strategy
Answer: C) defines the specific actions a firm will make.
●● 5) Common knowledge in game theory
Answer: A) is information known by all players.
,●● 6) Common knowledge in game theory
Answer: A) is information known to be known by all players.
●● 7) In a static game, firms
Answer: B) compete only once.
●● 8) A payoff matrix
Answer: C) shows the payoffs to each firm for each possible outcome.
●● 9) Which of the following is a simultaneous decision game?
Answer: D) rock-paper-scissors (Roshambo)
●● 10) Rock-paper-scissors (Roshambo) is an example of a ________
game.
Answer: A) simultaneous
●● New
11) A strategy is dominant if
Answer: B) it yields a payoff at least as large as that from any other
strategy, regardless of the actions of other players.
●● 12) Dominant strategies
,A) are always present in simultaneous games.
B) result in a prisoners' dilemma.
C) result in one firm winning and the other losing.
D) None of the above.
Answer: D) None of the above.
●● 13) A dominated strategy
Answer: C) is one that is never used by a rational actor.
●● 14) When both firms have dominant strategies
Answer: A) the outcome is called a dominant strategy solution.
●● 15) One interesting feature of a prisoner's dilemma game is that
Answer: A) non-cooperative behavior leads to lower payoffs than
cooperative behavior.
●● New
16) Mutually Assured Destruction was a standing policy during the Cold
War, in which the
United States and the USSR maintained and expanded nuclear arsenals
beyond practical levels.
What could explain such a phenomenon?
A) insane public officials who were bent on world domination
, B) a prisoner's dilemma
C) a leader-follower type game
D) tacit collusion
Answer: B
Skill: Analytical
AACSB: Analytical Thinking
●● New
5
Copyright© 2017 Pearson Education, Inc.
17) The term prisoners' dilemma refers to a game in which
A) there are no Nash equilibria.
B) there are no dominant strategies.
C) the payoff from both players playing their dominant strategies is the
same for each player.
D) the payoff from both players playing their dominant strategies is not
the highest payoff
possible.
Answer: D
Skill: Definition
AACSB: Application of Knowledge
●● Old
