Question 1

Which of the following best describes a dominant strategy in game theory?

Accepted Answer

A strategy that is optimal regardless of what the opponents do.

Question 2

In the sequential-move 'Crispy-Sweet' game, Firm 1 moves first and Firm 2 observes Firm 1's action. What is Firm 2's optimal strategy?

Accepted Answer

If Firm 1 plays Crispy, play Sweet; if Firm 1 plays Sweet, play Crispy.

Question 3

What is the Subgame Perfect Nash Equilibrium (SPNE) outcome for the sequential-move 'Crispy-Sweet' game, where Firm 1 moves first?

Accepted Answer

Firm 1 chooses Sweet, Firm 2 chooses Crispy.

Question 4

In the sequential-move 'Battle of the Sexes' game, if the girl moves first, what is the equilibrium payoff vector in the subgame perfect Nash equilibrium?

Accepted Answer

$$(3,2)$$

Question 5

Which solution concept is used to solve sequential-move games in this course?

Accepted Answer

Subgame Perfect Nash Equilibrium

Question 6

In the sequential-move duopoly game, Firm 1 moves first and Firm 2 follows. What is the subgame perfect Nash equilibrium payoff profile?

Accepted Answer

$$(112,56)$$

Question 7

If Firm 2 moves first in the sequential-move duopoly game, what is the subgame perfect Nash equilibrium payoff profile?

Accepted Answer

$$(56,112)$$

Question 8

In the simultaneous-move variant of the duopoly game (Cournot game), what is the Nash equilibrium strategy for both firms?

Accepted Answer

Both firms play M.

Question 9

Which of the following statements about first-mover advantage in sequential-move games is correct?

Accepted Answer

First-mover advantage depends on the structure of the game.

Question 10

In the 'Divide and Choose' game, what is Player 1's optimal strategy when dividing the pie?

Accepted Answer

Divide the pie equally to maximize the size of the smaller piece.

Question 11

In the 'Divide and Choose' game, what does Player 2 do after observing Player 1's division?

Accepted Answer

Chooses the larger piece.

Question 12

Which of the following is NOT a characteristic of a Nash Equilibrium?

Accepted Answer

Each player is playing a dominant strategy.

Question 13

Consider a sequential-move game where the leader anticipates the follower’s optimal response. What method is used to solve for the equilibrium?

Accepted Answer

Backward induction

Question 14

In a sequential-move game, what is a strategy for the follower?

Accepted Answer

A contingent plan of actions based on the leader’s move.

Question 15

Which of the following best describes a maximin strategy?

Accepted Answer

A strategy that maximizes the minimum gain that can be earned.

Question 16

In the sequential-move 'Crispy-Sweet' game, what are the payoffs in the Subgame Perfect Nash Equilibrium?

Accepted Answer

$$(20,10)$$

Question 17

Suppose in a sequential-move game, the follower’s optimal strategy is to always match the leader’s action. What should the leader do to maximize their payoff?

Accepted Answer

Choose the action that gives them the highest individual payoff when matched.

Question 18

In the sequential-move duopoly game, what is Firm 2’s optimal strategy if Firm 1 plays H?

Accepted Answer

Play L.

Question 19

Which of the following is a real-world example of a sequential-move game?

Accepted Answer

A negotiation where one party makes an offer and the other responds.

Question 20

In the 'Divide and Choose' game, if Player 1 divides the pie unequally, what is the likely outcome?

Accepted Answer

Player 2 chooses the larger piece, minimizing Player 1’s payoff.

Sequential-Move Games and Subgame Perfect Nash Equilibrium in Microeconomics

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