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Theory of Games and Economic Behavior by John Von Neumann - Exam
  • 1. Which of the following is a type of game that has a clear conflict of interest?
A) Zero-sum game.
B) Public goods game.
C) Evolutionary game.
D) Cooperative game.
  • 2. Who are the authors of the book 'Theory of Games and Economic Behavior'?
A) John Nash and Roger Myerson.
B) Kenneth Arrow and George Stigler.
C) Daniel Kahneman and Amos Tversky.
D) John Von Neumann and Oskar Morgenstern.
  • 3. In cooperative games, what is the core?
A) The basic strategy that guarantees a win.
B) A stable outcome without any external enforcement.
C) The set of feasible allocations that cannot be improved upon by any coalition.
D) An allocation accepted by all players without negotiation.
  • 4. What does 'subgame perfect equilibrium' refer to?
A) An outcome determined by chance.
B) An equilibrium where players' strategies are optimal in every subgame.
C) A situation where players cannot change their strategies.
D) An equilibrium that exists only in finite games.
  • 5. Who introduced the concept of game theory in economics?
A) Milton Friedman.
B) John Von Neumann.
C) Adam Smith.
D) David Ricardo.
  • 6. What is a 'Pareto efficient' outcome?
A) An outcome where players always get equal benefits.
B) An optimal outcome only for one player.
C) An allocation where no player can be made better off without making another player worse off.
D) A game that always ends in a tie.
  • 7. What is a strictly dominated strategy?
A) A strategy that is worse than another strategy for every possible action of the other players.
B) A strategy that is randomly chosen.
C) A strategy that cannot be improved upon.
D) A strategy that is better in some cases and worse in others.
  • 8. What does ‘best response’ mean in game theory?
A) The strategy that ensures a win every time.
B) The strategy that yields the highest payoff given the other players' strategies.
C) The most conservative choice.
D) Any strategy that players prefer.
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