📚 Learning Guide
Dominant Strategies in Game Theory
easy

In game theory, a dominant strategy is defined as a strategy that is the best choice for a player regardless of what the other players do. Which of the following scenarios best illustrates a dominant strategy?

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Choose the Best Answer

A

A firm consistently lowers prices to undercut competitors.

B

A player always chooses to cooperate in a Prisoner's Dilemma.

C

A student studies hard for every exam regardless of the difficulty.

D

A voter chooses a candidate based solely on party affiliation.

Understanding the Answer

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Answer

In game theory, a dominant strategy is a choice that always leads to the best outcome for a player, no matter what the others decide. For example, imagine two friends, Alex and Jamie, deciding whether to study for a test or go to a party. If Alex knows that studying will always give him a higher grade than going to the party, regardless of what Jamie does, then studying is Alex's dominant strategy. This means that even if Jamie chooses to study or go to the party, Alex will still benefit most by studying. In this way, a dominant strategy helps players make the best decision without worrying about others' choices.

Detailed Explanation

A firm that lowers prices all the time is making the best choice. Other options are incorrect because Choosing to cooperate in a Prisoner's Dilemma isn't always the best choice; Studying hard for every exam may not be the best strategy.

Key Concepts

dominant strategy
Topic

Dominant Strategies in Game Theory

Difficulty

easy level question

Cognitive Level

understand

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