Why is Behavioural Economics so interesting today?

Because our decisions are affected by social and psycological influences

What is the certainty effect paradox

Given different risk level of people they prefer certainty

What is the Game Theory

tools help us understand observations when players interact

organized sale where the buyers compete among them bidding

What is a pure strategy equilibrium:

Players play one specific strategy

What is reputation building

Make the company known as a reliable cooperator

A game with infinite repetitions, when there is no defined end of the game, is an incentive to

is an incentive to increase cooperation

In an extensive game with perfect information,

backward induction usually prescribes unique choices

What is the first mover advantage

A player who can commit to a strategy and inform the others

Which is not a type of games or representation of games

Corporate and non corporate games

What is a private value in an auction

each bidder knows only her own value

Internal motivations reflects

the influence of our internal goals and attitudes

What is the problem of using weak dominance technique

Often give very imprecise predictions about a game

A subgame is defined to begin

when the history of prior play is common knowledge

is a randomization over the available pure strategies

What is an strategic interaction

Situat when agents take account the decisions of other agent

What is Ecological rationality?

We do not have time to collect lots of information

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GAME THEORY 3 business workshop USJ

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1
Why is Behavioural Economics so interesting today?
Because it is interesting to study behaviour
Because it gives us a more mathematicial account of our decission-making
Because BE only consider efficient economic decisions
Because our decisions are affected by social and psycological influences
2
What is the certainty effect paradox
People are not prepared to take risks
Given an option of certainty outcome all behave according to their risk lev
Given different risk level of people they prefer certainty
People behave stable and steady response to different risky outcomes
3
What is the Game Theory
It is the prediction of what players will earn
it is a mental or physical activity
It is a game where players act irrationally
tools help us understand observations when players interact
4
Auctions are a
organized sale where players do not compete bidding
organized sale where the buyers compete in internet
disorganized sale where the buyers compete bidding
organized sale where the buyers compete among them bidding
5
What is a pure strategy equilibrium:
At least one player randomizes over some strategies
Players play mixed strategies
Player is playing only for himself
Players play one specific strategy
6
A strategy that always does better than any other strategy is
A interaction strategy
A inefficient strategy
A dominant strategy
A weak dominant strategy
7
What is reputation building
Make the company better known
Make the company known as a competitor
Make the company known as a reliable cooperator
Make a new strategy through punishment
8
A game with infinite repetitions, when there is no defined end of the game, is an incentive to
is an incentive to avoid cooperation
none
is an incentive to cheat
is an incentive to increase cooperation
9
Dynamic games can be analysed by
forward induction technique
iteraty weak equilibrium
only through dominance strategy
backward induction technique
10
In an extensive game with perfect information,
backward induction usually prescribes unique choices
player never knows other player movements
player is always indiferent between choices
backward induction never prescribes a choice
11
What is the first mover advantage
A player who has no power to move
A player who can commit to a strategy and inform the others
A player who can not commit to a strategy
A player who is new in the game
12
Which is not a type of games or representation of games
Complete information and Incomplete information
Normal form and Extensive form of games
Corporate and non corporate games
Static and Dynamic
13
What is a private value in an auction
the actual value of the object is the same for everyone
each bidder knows only her own value
a good who has no value
the actual value of the object is indifferent
14
Internal motivations reflects
the social reward that motivates us
incentives and motivations that are external to us as individuals
the economic price that rewards us
the influence of our internal goals and attitudes
15
What is the problem of using weak dominance technique
There are no problems
The order in which apply weak dominance not affect outcome
Often give very imprecise predictions about a game
It never allows you to reach a solution
16
A subgame is defined to begin
when the history of prior play is impossible
when the history of prior play is no common knowledge
when the history of prior play is perfect
when the history of prior play is common knowledge
17
A mixed strategy:
is a randomization over the available pure strategies
imply payoffs without uncertainty
is means not to execute a strategy
it is always more accurate than a pure strategy
18
What is an strategic interaction
Situat when agents take account the decisions of other agent
interaction between irrational agents
every agent considers only their decisions
Situation when agents take into account their own beliefs
19
What is heuristics
a tool that economize time but not the congnitive effort
A quick decision-making tool
A rational way ot making decisions
A technique that considers all the information available
20
What is Ecological rationality?
We are limited by various constraints when deciding
We have limits on memory or numerical processing ability
We do not adapt to new circunstances. We do not like changes
We do not have time to collect lots of information

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