1			Which of the following statements is not true about an oligopoly?
			A)	An industry consisting of two firms is called a duopoly
			B)	It consists of a small number of firms producing close substitutes
			C)	Oligopolistic firms are price takers
			D)	An oligopoly tends to produce more output than a monopoly but less than that of a perfectly competitive industry.
2			The basic elements of a game include all of the following except:
			A)	The number of rounds
			B)	The players
			C)	The payoff to each player for each possible action
			D)	The available strategies
3			The strategy that yields a higher payoff no matter what the other player does is called:
			A)	Dominated strategy
			B)	Dominant strategy
			C)	Dominant equilibrium
			D)	Nash equilibrium

Use the following payoff matrix for Etihad Airways and Emirates Airlines to answer questions 4 to 6:

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4			Following the payoff matrix above, what is the dominant strategy for Etihad Airways?
			A)	Start a new route
			B)	Do not start a new route
			C)	Etihad Airways does not have a dominant strategy
			D)	None of the above
5			Following the payoff matrix above, what is the dominant strategy for Emirates Airlines?
			A)	Start a new route
			B)	Do not start a new route
			C)	Etihad Airways does not have a dominant strategy
			D)	None of the above
6			Following the payoff matrix above, what is the outcome of this game?
			A)	Etihad Airways starts a new route; Emirates Airlines does not start a new route
			B)	Etihad Airways does not start a new route; Emirates Airlines starts a new route
			C)	Etihad Airways does not start a new route; Emirates Airlines does not start a new route
			D)	Etihad Airways starts a new route; Emirates Airlines starts a new route

Use the following payoff matrix for US and Japan to answer questions 7 to 9:

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7			Following the payoff matrix above, what is Japan's dominant strategy?
			A)	Impose tariff
			B)	Do not impose tariff
			C)	Japan does not have a dominant strategy
			D)	None of the above
8			Following the payoff matrix above, what is US's dominant strategy?
			A)	Impose tariff
			B)	Do not impose tariff
			C)	Japan does not have a dominant strategy
			D)	None of the above
9			Following the payoff matrix above, what is the socially optimal strategy?
			A)	It is the same as the dominant strategy, both US and Japan impose a tariff
			B)	It is different from the dominant strategy, both US and Japan do not impose a tariff
			C)	It is the same as the dominant strategy, both US and Japan do not impose a tariff
			D)	It is different from the dominant strategy, both US and Japan impose a tariff
10			For games where timing matters, we use:
			A)	A payoff matrix
			B)	A decision tree
			C)	A game tree
			D)	None of the above
11			A possible way to improve the outcome of a game is:
			A)	Using credible threats
			B)	Using credible promises
			C)	Altering psychological incentives
			D)	All of the above

Use the following payoff matrix for a duopoly to answer questions 12 to 15:

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12			Following the payoff matrix above, what is the dominant strategy for Firm 1?
			A)	Have a small advertising budget
			B)	Have a large advertising budget
			C)	Firm 1 does not have a dominant strategy
			D)	None of the above
13			Following the payoff matrix above, what is the dominant strategy for Firm 2?
			A)	Have a small advertising budget
			B)	Have a large advertising budget
			C)	Firm 2 does not have a dominant strategy
			D)	None of the above
14			Following the payoff matrix above, what is the outcome of this game?
			A)	Both firms have a small advertising budget
			B)	Both firms have a large advertising budget
			C)	Firm 1 has a small advertising budget, while Firm 2 has a large advertising budget
			D)	It cannot be determined based on the information given
15			Assuming that Firm 1 decides on having a small advertising budget. Based on that, Firm 2 will decide to:
			A)	Have a small advertising budget
			B)	Have a large advertising budget
			C)	Firm 2 does not have a preference
			D)	None of the above