Question

1. in some sequential move games there is a first-mover advantage; in others there is a second-mover advantage.

True

False

2. The experimental evidence on the ultimatum game shows that players will sometimes reject offers that give them a positive share of the pie. This behavior is consistent with rational behavior.

True

False

Answer 1

The Answer to first question is true

The Answer to second question is false

The Ultimatum Game, introduced by Werner Guth and colleagues (1982), is a simple, take-it-or-leave-it bargaining environment. In ultimatum experiments two people are randomly and anonymously matched, one as proposer and one as responder, and told they will play a game exactly one time. The proposer is endowed with an amount of money, and suggests a division of that amount between herself and her responder. The responder observes the suggestion and then decides whether to accept or reject. If the division is accepted then both earn the amount implied by the proposer’s suggestion. If rejected, then both the proposer and responder earn nothing for the experiment