Question

6. While prisoner’s dilemma outcomes may produce worse results for competing companies than other alternate outcomes, such dilemmas can benefit:

A.

third parties who do business with the competing companies.

B.

the stockholders of the competing companies.

C.

third parties who do not transact business with the competing companies.

D.

the employees of the competing companies.

7. Some prisoner’s dilemma outcomes can be resolved when the players engage in:

A.

repeated games.

B.

competitive behavior.

C.

one-time games.

D.

irrational behavior.

True/False Questions

After watching the Game Theory video lecture, consider the question(s) below. Then “submit” your response.

1. Game theory can be applied in business, political science, military planning, and sports.

A.

True

B.

False

2. A Nash equilibrium always yields the best outcome for all participants in a game.

A.

True

B.

False

3. Prisoner’s dilemma outcomes are uncommon.

A.

True

B.

False

Answer 1

Ans 6)

Option C is correct because for an example if two firms in the market are part of prisoners dilemma then both firms end up getting lower payoff such as lower price higher outputs which may benefit consumers of the market they are third party

Hence option C is correct

Ans 7)

Option A is correct that is both players can get higher outcome that is Pareto optimal when they collude which is possible in repeated games to sustain collusion

Therefore option A is correct

Ans 1)

Game Theory is used not only in the all branches of economics but in business management, sports etc.

Hence given statement is true

Ans 2)

It is false because if we observe Prisoners dilemma game in such games outcomes are sub optimal where optimal outcomes are not chosen.

Hence False statement

Ans 3)

False.because due to disbelief between two players result into unsuccessful collusion and finally sub optimal outcome is observed.

Hence it is False statement