What Is a Zero-Sum Game

question 80

Multiple Choice

What is a zero-sum game?

• A) A situation in which the market mechanism determines what a country imports and what it exports.
• B) A situation in which a country engages in international trade even for products it is able to produce for itself.
• C) A situation in which a gain by one country results in a loss by another.
• D) A situation in which limits on imports are often in the interests of domestic producers, but not domestic consumers.
• E) A situation in which one country has an absolute advantage in the production of all goods.

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Definitions:

Convex Preferences

Preferences that express a consumer's desire for diversified bundles of goods over extreme bundles, depicted graphically as convex indifference curves.

Edgeworth Box

A diagram representing various distributions of resources, used to examine issues of allocation efficiency in economics.

Indifference Curves

Graphical representations showing combinations of two goods that give a consumer equal levels of satisfaction, indicating preferences.

Pareto Optimal

A condition of resource allocation in which it is impossible to make any one individual better off without making someone else worse off, signifying an efficient distribution of resources.