Game theory is:
A)a view on the development of children's games and toys.
B)the analysis of market forces when there is role reversal for buyers and sellers.
C)the science of making good decisions in situations involving strategic interactions.
D)a view on decision making when clear paths to optimum outcomes are known.

Question

Quizplus · Accepted Answer

Game theory is the study of decision-making in situations where multiple parties are involved and where the outcome of a participant's choice of action depends critically on the actions of other participants. It involves strategic interaction and the science of making good decisions in such situations. Therefore, option C is the correct definition of game theory. Option A is incorrect because game theory pertains to strategic decision-making by multiple parties, not just children. Option B is incorrect because the analysis of market forces when there is role reversal for buyers and sellers is not game theory, but rather market reversal theory. Option D is incorrect because game theory does not necessarily involve clear paths to optimum outcomes.

Game Theory Is