What is a dominant strategy equilibrium? What will be an ideal ...

[silviawilliams41]

What is a dominant strategy equilibrium?
 
  What will be an ideal response?

Question 2

Because ________ in the government budget deficit increase the real interest rate, budget deficits can ________ firm investment.
 
  A) decreases; increase B) increases; decrease
  C) decreases; decrease D) increases; increase

[Sweetkitty24130]

Answer to Question 1

When a player has the same best response to every possible strategy of the other players, then we say that the player has a dominant strategy. A combination of strategies is a dominant strategy equilibrium if each strategy is a dominant strategy.

Answer to Question 2

B

[silviawilliams41]

Thanks for the timely response, appreciate it

[rachel]

Great answer, keep it coming