Strayer Eco301 week 4 quiz 3

Question 1 A football team has the chance of scoring the game-winning touchdown on the last play of the game. It can either run or pass. The defense can play for the run or play for the pass. The following normal form lists the payoffs from the game made up by this last play. The payoffs are probabilities of winning the game. OffenseDefenseDefend PassDefend RunPass0, 11, 0Run1, 00, 1The Nash equilibrium is (equilibria are)Answerthe offense runs and the defense plays for the run.the offense passes and the defense plays for the pass.the offense runs and the defense plays for the pass.both pick their choice at random with equal probability.5 points Question 2 The game of Matching PenniesAnswerhas no Nash equilibrium.has a pure-strategy Nash equilibrium.has a mixed strategy Nash equilibrium.has multiple Nash equilibria.5 points Question 3 The beauty of Nash’s equilibrium concept is thatAnswerall games have one.all games have no more than one.all games have a rich set to choose from.it is a Pareto optimum.5 points Question 4 In what way or ways can strategies more complicated than simple actions?AnswerThey can be conditioned on a first mover’s action.They can involve random choices.Both a and b.Neither a or b.5 points Question 5 A lake supports a delicious variety of fish. The land around the lake is owned by two fisherman, so by state law both are free to fish as much as they like. LetFAandFBbe the number of fish each catches, respectively. Suppose the price of fish is 100 -FA-FB. Given this demand curve, it turns out that marginal revenue is 100 – 2FA-FBfor fisherman A and 100 -FA- 2FBfor fishermanB. What is thetotalnumber of fish by both in the Nash equilibrium?Answer304560905 points Question 6 A football team has the chance of scoring the game-winning touchdown on the last play of the game. It can either run or pass. The defense can play for the run or play for the pass. The following normal form lists the payoffs from the game made up by this last play. The payoffs are probabilities of winning the game. OffenseDefenseDefend PassDefend RunPass0, 11, 0Run1, 00, 1What is the defense’s dominant strategy?AnswerDefend the run.Defend the pass.Defend both plays at random with equal probability.The defense does not have a dominant strategy.5 points Question 7 TeensAandBare smitten with each other but neither knows of the other’s feelings. Suppose the teachers at their school organize a dance. The “payoff” is based on whether their advances are rebuffed or accepted. If they both Declare, they get positive utility but if they are Rebuffed they face humiliation (significantly negative payoff). Rebuffing an advance slightly elevates the teen’s standing with peers. TeenATeenBDeclareIgnore/ RebuffDeclare10, 10-10, 1Ignore/Rebuff1, -100, 0What is a teen’s dominant strategy?AnswerDeclare.choose at random.Rebuff/Ignore.No dominant strategy.5 points Question 8 If the Prisoners’ Dilemma is repeated over and over again with the same two players having an indefinite time horizon,Answerthe unique equilibrium is to play the Nash equilibrium of Confess each period.players can cooperate on Silent if they are not too patient.players can cooperate on Silent if they are patient enough.players can only cooperate on Silent in the initial stages of the game.5 points Question 9 A subgame-perfect equilibrium is a Nash equilibrium thatAnswercannot persist through several periods.involves only credible threats.consists only of dominant strategies.is unique.5 points Question 10 When a game has multiple equilibria, a useful method to sort out which one would be the “best” prediction is toAnswerfind the one (if any) in which both players are better off than in any other equilibrium.find the equilibrium that is symmetric, if any.find the one which seems “focal”, if any.all of these.5 points Question 11 The marginal physical product of labor is defined asAnswera firm’s total output divided by total labor input.the extra output produced by employing one more unit of labor while allowing other inputs to vary.the extra output produced by employing one more unit of labor while holding other inputs constant.the extra output produced by employing one more unit of capital while holding labor input constant.5 points Question 12 .strayer.edu/courses/1/ECO301001VA016-1152-001/ppg/respondus/exam_Week_4_Quiz/img4d3487e97.gif” alt=””>With a quadratic production with fixed capital Q = A + BL +CL2and the shape shown above, B isAnswerpositive.zero.negative and less than D.negative and greater than D.5 points Question 13 Suppose Q = K?L?, if ? + ? > 1 the isoquants will beAnswerupward sloping.progressively closer together at higher quantities.progressively further apart at higher quantities.equally spaced.5 points Question 14 Suppose electricity (E) can be produced with coal (C) or gas (G) to operate steam turbines (T). Suppose gas is more efficiently burned than coal but that they are otherwise perfect substitutes. E = ((G + 1/2C), T) The isoquants between gas and coal will beAnswerhyperbolasquarter circlesstraight linesrectangular5 points Question 15 If Q = K2L2the MPLisAnswerconstantdiminishingincreasingnot enough information to determine5 points Question 16 Suppose the production function for goodqis given byq =3K +2LwhereKandLare capital and labor inputs. Consider three statements about this function: I.The function exhibits constant returns to scale.II.The function exhibits diminishing marginal productivities to all inputs.III.The function has a constant rate of technical substitution. Which of these statements is true?AnswerAll of them.Only I.I and II but not III.I and III but not II.5 points Question 17 Suppose Q = K?L?, if ? + ? < 1 the isoquants will beAnswerupward sloping.progressively closer together at higher quantities.progressively further apart at higher quantities.equally spaced.5 points Question 18 A firm’s isoquant showsAnswerthe amount of labor needed to produce a given level of output with capital held constant.the amount of capital needed to produce a given level of output with labor held constant.the various combinations of capital and labor that will produce a given amount of output.None of these.5 points Question 19 A technical innovation in the production of automobiles by Ford Motor Company’s for 1 million cars per year would necessarilyAnswershift the “1 million car” isoquant away from the origin.shift the “1 million car” isoquant toward the origin.cause 1 million cars to be produced with more capital and less labor.cause 1 million cars to be produced with more labor and less capital.5 points Question 20 If more and more labor is employed while keeping all other inputs constant, the marginal physical productivity of laborAnswerwill eventually increase.will eventually decrease.will eventually remain constant.cannot tell from the information provided.