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A tit for tat strategy has the best chance of working if a transaction is a one time event B the interaction between participants is frequent and open-ended

A tit for tat strategy has the best chance of working if:  

A. a transaction is a one time event

B. the interaction between participants is frequent and open-ended

C. the interaction is frequent, but has a specific end date

D. neither side in the interaction trusts the other's commitment to the strategy

12.The conditions discussed by Axelrod help to explain:  

A. only when people are most likely to defect

B. only when people cooperate

C. when people cooperate and also when they are most likely not to cooperate

D. why there is never mutual restraint in trench warfare

13.The unraveling problem in interdependent relationships arises from a situation in which:  

A. there is a known, finite number of future interactions

B. there is not a known, finite number of future interactions

C. interactions suddenly and surprisingly cease

D. a recession hits an industry

14.One difficulty is that tit-for-tat's effectiveness depends on the existence of:  

A. perfect information about another's actions

B. only two players in the game

C. an infinite number of players in the game

D. an industry that is not growing

15.The model of monopolistic competition differs from the model of perfect competition in which of the following assumptions?  

A. Free entry and exit

B. Product homogeneity

C. Large number of firms

D. Perfect information

16.In a battle of Boeing and Airbus a Nash equilibrium will exist if:  

A. they both have agreed to a monopoly pricing structure

B. they are presently operating at a point where neither one would benefit by unilaterally changing strategies

C. Boeing has the power to drive Airbus out of business with a predatory pricing strategy

D. both pass up profit opportunities because they fear retaliation

17.In sequential game strategies, each player could avoid the worst case outcomes by:  

A. assuming that the other player will always rationally avoid its worst case outcome

B. pursuing a strategy that leads toward the highest end point gains possible

C. pursuing a strategy that leads in the direction of the worst case scenario

D. the strategies listed in both a and b will definitely keep one from the worst case scenario

18.Excess capacity for a firm in an oligopoly situation:  

A. can not contribute to long run profit for a firm

B. encourages competitors to enter the market and build at optimal capacity

C. is a deterrent to entry in the market by potential competitors

D. will be temporary if the planning was done right

19.In the Cournot model:  

A. each firm takes the quantities produced by its rivals as given

B. each firm takes the prices charged by its rivals as given

C. one firm plays a leadership role and its rivals merely follow

D. prices are higher and quantities are slightly less than we would see if the firms colluded

20.In the Bertrand model:  

A. each firm takes the quantities produced by its rivals as given

B. each firm takes the prices charged by its rivals as given

C. one firm plays a leadership role and its rivals merely follow

D. prices are higher and quantities are slightly less than we would see if the firms colluded to achieve the monopoly outcome

Feb 11 2020 View more View Less

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