Two games that differ only in the timing of moves—one simultaneous, the other sequential move—can sometimes have completely different subgame-perfect equilibria. Why?
a. The second mover to choose non-credible threats.
b. The first mover can choose an action that it would deviate from if its action were secret.
c. Subgame-perfect equilibrium cannot be applied to simultaneous games.
d. All of the above.
b
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The number of sellers in a market is considered to be large when
a. the total exceeds 100 b. no single buyer can affect the price through his or her demand for the product c. they cannot be easily counted d. no single seller can affect the price by changing its level of output e. no seller controls more than 20 percent of the total market supply
The Fed
A) can easily distinguish the minor ups and downs of the economy from a recession. B) can have difficulty distinguishing the minor ups and downs of the economy from a recession. C) always times its policy responses correctly. D) can easily determine if a drop in production means a recession is inevitable.