When a Game Has More Than One Nash Equilibrium

question 54

Multiple Choice

When a game has more than one Nash equilibrium,

• A) at least one of them will be Pareto optimal.
• B) they will all tend to be unstable.
• C) they must provide the same total payoff to the players.
• D) it is difficult to predict which of them will actually occur.

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Definitions:

Economic Models

Theoretical constructs that represent economic processes by a set of variables and a set of logical and/or quantitative relationships between them.

Policies

Guidelines or principles adopted by an organization, government, or individual to guide decision-making and achieve desired outcomes.

Positive Economics

The branch of economic analysis that describes the way the economy actually works.

Production Possibility Frontier

A visual map outlying the highest possible production levels for two goods, considering a defined compilation of resources and other relevant factors.