Lesson test: Moving in sequence

Sign in

Libre University uses your GitHub account. Signing in is only needed to sit a final test, so the score is kept on your profile.

Moving in sequence

1.[2p]
Player 1 moves first with three actions, and after each of them player 2 chooses between two actions. How many strategies does player 2 have?

CorrectNot quite: 8

2.[3p]
Why must a strategy specify an action at nodes that will never be reached?

Because the other player's choice depends on what would happen there

Correct

Because the payoffs at those nodes are added to the total

The answer is: Because the other player's choice depends on what would happen there

Because backward induction starts at unreached nodes

The answer is: Because the other player's choice depends on what would happen there

It need not: those actions are conventionally left blank

The answer is: Because the other player's choice depends on what would happen there

3.[2p]
Put the steps of backward induction in order.

Find a decision node whose branches all lead to terminal nodes
Settle what the player there would choose by comparing payoffs
Repeat on the shortened tree until the first node is reached
Replace that node with the payoffs its choice produces

Show the answer

a, b, c, d

4.[2p]
Kuhn's 1953 theorem says that every finite game of perfect information

has a Nash equilibrium in pure strategies, found by backward induction

Correct

has exactly one Nash equilibrium

The answer is: has a Nash equilibrium in pure strategies, found by backward induction

requires mixed strategies to be solved

The answer is: has a Nash equilibrium in pure strategies, found by backward induction

is zero-sum

The answer is: has a Nash equilibrium in pure strategies, found by backward induction

5.[3p]
Demand is $p = 100 - Q$ with unit cost £40, and firm 1 chooses its quantity first. What quantity does the leader produce?

CorrectNot quite: 30

6.[3p]
In that Stackelberg equilibrium, what is the leader's profit in pounds?

CorrectNot quite: 450

7.[3p]
Comparing the Stackelberg outcome with the simultaneous Cournot outcome in that market, which are true?

Select all that apply

Total output is higher and the price is lower

Correct

The leader earns more than either firm earns in the Cournot equilibrium

Correct

The follower earns less than it would in the Cournot equilibrium

Correct

Total industry profit is higher

The answer is: Total output is higher and the price is lower, The leader earns more than either firm earns in the Cournot equilibrium, The follower earns less than it would in the Cournot equilibrium

8.[2p]
Moving first is an advantage in every game where one player can commit before the other.

True

The answer is: False

False

Correct

9.[2p]
In the centipede game, backward induction predicts that

the first player takes immediately, leaving most of the potential pot unclaimed

Correct

both players pass until the final node

The answer is: the first player takes immediately, leaving most of the potential pot unclaimed

the players alternate taking and passing

The answer is: the first player takes immediately, leaving most of the potential pot unclaimed

the outcome depends on the size of the initial pot

The answer is: the first player takes immediately, leaving most of the potential pot unclaimed

1.[2p] Player 1 moves first with three actions, and after each of them player 2 chooses between two actions. How many strategies does player 2 have?

2.[3p] Why must a strategy specify an action at nodes that will never be reached?

3.[2p] Put the steps of backward induction in order.

4.[2p] Kuhn's 1953 theorem says that every finite game of perfect information

5.[3p] Demand is p=100-Q with unit cost £40, and firm 1 chooses its quantity first. What quantity does the leader produce?

6.[3p] In that Stackelberg equilibrium, what is the leader's profit in pounds?

7.[3p] Comparing the Stackelberg outcome with the simultaneous Cournot outcome in that market, which are true?

8.[2p] Moving first is an advantage in every game where one player can commit before the other.

9.[2p] In the centipede game, backward induction predicts that

1.[2p]
Player 1 moves first with three actions, and after each of them player 2 chooses between two actions. How many strategies does player 2 have?

2.[3p]
Why must a strategy specify an action at nodes that will never be reached?

3.[2p]
Put the steps of backward induction in order.

4.[2p]
Kuhn's 1953 theorem says that every finite game of perfect information

5.[3p]
Demand is $p = 100 - Q$ with unit cost £40, and firm 1 chooses its quantity first. What quantity does the leader produce?

6.[3p]
In that Stackelberg equilibrium, what is the leader's profit in pounds?

7.[3p]
Comparing the Stackelberg outcome with the simultaneous Cournot outcome in that market, which are true?

8.[2p]
Moving first is an advantage in every game where one player can commit before the other.

9.[2p]
In the centipede game, backward induction predicts that