Game Theory and Oligopoly Practice
Two players, two choices, four outcomes. Click through the payoff matrix to see each player's best response and where the Nash equilibrium lands. Then answer five exam-style questions on dominant strategies, the prisoner's dilemma, cartels, and why repetition changes everything.
One tile of the full oligopoly and game theory unit.
The course teaches oligopoly and game theory interactively — drag the graphs, practice with feedback, and spaced reviews bring it back before you forget. Free.
How to read a payoff matrix
- Each cell holds two numbers: the row player's payoff first, the column player's second.
- For each column, find the row that gives the row player the higher payoff — that is their best response. Do the same for the column player in each row.
- A strategy that is the best response to everything the rival might do is dominant. A cell where both players are playing best responses is a Nash equilibrium.
Interactive payoff matrix
A classic prisoner's dilemma. Click cells to explore; the highlights show each player's best response.
Five practice questions
Pick an answer, then click Check answer to see the explanation.
Question 1 of 5
Two airlines each choose a High or Low fare. If both choose High, each earns 10. If one chooses Low while the other stays High, the Low airline earns 15 and the High airline earns 2. If both choose Low, each earns 5. What is the Nash equilibrium?
Question 2 of 5
Which statement correctly defines a Nash equilibrium?
Question 3 of 5
Members of a cartel agree to restrict output so the price rises to the monopoly level. Why do cartels tend to break down?
Question 4 of 5
The same two firms play the pricing game every quarter, indefinitely. How does repetition change the outcome compared with the one-shot game?
Question 5 of 5
What distinguishes an oligopoly from perfect competition and monopoly?
What the course adds
Beyond this one page
The oligopoly-and-game-theory unit has dozens of practice questions on payoff matrices, dominant strategies, Nash equilibrium, cartels, and the Cournot and Bertrand models. Each session pulls from your weak spots — not the same five questions every time.
Spaced reviews
FSRS brings every concept back right before you'd forget. ~50% better retention than re-reading.
Per-concept mastery
Performance Factor Analysis tracks each sub-skill separately — you see which version of the idea is still wobbly.
Diagnostic placement
A short test skips you past what you already know. No re-learning the basics.
For instructors
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The full Econ Academy oligopoly-and-game-theory unit includes adaptive practice, spaced repetition, and mastery tracking so you stop forgetting what you just learned.