Economists use game theory to predict the behavior of oligopolists.Which of the following is crucial for the success of the analysis?
A)Make sure the payoffs reflect the true payoffs of the oligopolists.
B)Make sure whether the oligopolists move simultaneously or sequentially.
C)Make sure the problem considered is of a one-shot or repeated nature.
D)All of the statements associated with this question are correct.

Question

Quizplus · Accepted Answer

All of the statements associated with this question are correct. It is important to ensure that the payoffs used in the analysis accurately reflect the true payoffs of the oligopolists in order to make meaningful predictions. Additionally, whether the oligopolists move simultaneously or sequentially can have a significant impact on their behavior and the outcome of the game. Finally, determining whether the problem being considered is of a one-shot or repeated nature is crucial for understanding how the oligopolists will behave and make decisions over time.

Economists Use Game Theory to Predict the Behavior of Oligopolists