1. For threats or commitments to be effective, they must be
a. irrational.
b. rational.
c. credible.
d. None of the above.

2. How many pure strategy equilibria does the following game have?
a. 0
b. 1
c. 2
d. 3

3. Consider a vendor€“buyer relationship. Which of the following conditions would lead to the buyer having more bargaining power?
a. Lots of substitutes for the vendor€™s product are available.
b. There are relatively few buyers and many vendors.
c. It costs little for buyers to switch vendors.
d. All of the above.

4. Pete and Lisa are entering into a bargaining situation in which Pete stands to gain up to $5,000 and Lisa stands to gain up to $1,000. Who is likely to be the better bargainer?
a. Pete
b. Lisa
c. They will be equally effective.
d. The potential gains will have no impact on bargaining.

5. The game of chicken has
a. a second-mover advantage.
b. a first-mover advantage.
c. no sequential-move advantage.
d. potential sequential-move advantages, depending on theplayers.

LABOR Bargain Hard Bargain Hard Be Nice 0, 0 10, 20 Be Nice 20, 10 15, 15 Mgmt.