The Difference Between a Nash Equilibrium Strategy and a Dominant

question 14

Multiple Choice

The difference between a Nash equilibrium strategy and a dominant strategy is:

• A)nothing;they are synonymous.
• B)the former is stable but the latter is unstable.
• C)the former must be a best response to all others' strategy profiles,whereas the latter need only be a best response to others' Nash equilibrium strategies.
• D)the former need only be a best response to others' Nash equilibrium strategies,whereas the latter must be a best response to all others' strategy profiles.

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Definitions:

Robinson-Patman Act

A United States federal law that aims to prevent anticompetitive practices by producers, specifically price discrimination.

Price Discrimination

occurs when a seller charges different prices to different buyers for goods of like grade and quality, without justification.

Discriminatory Price

A pricing strategy where different prices are charged for the same product or service in different markets or to different segments of consumers without a corresponding difference in cost.

Clayton Act

An antitrust law in the United States that prohibits certain actions leading to anti-competitiveness, such as price discrimination and exclusive deals.