2010 Practice Final

# 2010 Practice Final - Economics 112 Spring 2010 Practice...

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Economics 112 Spring 2010 Practice Final Exam 0. Have you read the instructions? Have you put your name and student number on this paper and the multiple choice answer sheet? Will you use your time wisely? 1. Consider the following normal form game Player A Player B Left Right Up 0, 2 5,1 Down 3,3 10,8 Which of the following statements is true a. (Down,Right) is a Nash Equilibrium. b. (Down,Right) is a Dominant Strategy Equilibrium. c . (Down, Left) is a symmetric equilibrium. d. Both (a) and (b) are true. 2. Consider the following Normal form game: Player B Left Right Up 5,5 -4,* Down 10,-4 -2,-3 This game is a social dilemma provided that a. The payoff * is greater than -3. b. The payoff * is greater than 5 c. The payoff * is equal to 10 d. none of the above 3. A Risk Dominant equilibrium refers to a situation is which a. Players choose the strategies that maximise their payoffs in the worst-case choices by other players. b. Players choose the Nash equilibrium strategies that maximise their payoffs in the worst- case choices by other players. c. Players choose the strategies that lead to the lowest payoff Nash Equilibrium. d. All of the above. 4. The game of matching pennies a. Has no rational solution b. Has two Nash Equilibria c. Illustrates the pointlessness of planning d. Has only one Nash Equilibrium 5. Consider a gamble that pays \$-1 if a fair coin toss comes up heads and pays \$1 if it comes up tails. A risk neutral person would a. Never pay an amount greater than \$0 for this lottery b. Ignore the risk of loss, and pay up to \$1 for this lottery c. Lose expected utility by playing this gamble d. None of the above

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6. Consider a proportional game between a large group of commuters. The more commuters
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## This note was uploaded on 01/28/2011 for the course ECON 112 taught by Professor Notsure during the Winter '08 term at University of Victoria.

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2010 Practice Final - Economics 112 Spring 2010 Practice...

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