9. A buyer confronted with imperfect information will often believe that the price being charged reveals something about the quality of the product. True or False.

a. True

b. False

Booster class

Microeconomics

Skill

Explaining Imperfect Information

answer

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Raushan RajLv8

2 Nov 2020

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Related questions

2. Imperfect information refers to the situation where buyers and/or sellers do not have all of the necessary information to make an informed decision about the price or quality of a product. Asymmetric information is the condition where one party, either the buyer or the seller, has more information about the quality or price of the product than the other party. True or False.

a. True

b. False

6. Even with imperfect information, prices still reflect information about a product. True or False.

a. True

b. False

Answer the following as True, False, or Uncertain.

Part a: Backward induction can be applied to solve any extensive game with perfect information.

Part b: Every NE of an extensive game is subgame perfect.

Part c: An extensive game with perfect information is always equivalent to an extensive game with imperfect information.

Part d: The subgame of an extensive game with perfect information is the same as a game with imperfect information.

Part e: If a stage game (i.e., a game played only once) has a unique Nash equilibrium, then its finitely repeated counterpart has also a unique subgame perfect Nash equilibrium"