Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter18: Auctions
Section: Chapter Questions
Problem 4MC
Related questions
Question
1 \ 2 |
a |
b |
c |
A |
2,2 |
2,1 |
0,0 |
B |
3,1 |
3,0 |
1,3 |
C |
1,3 |
3,2 |
3,1 |
a) Eliminate iteratively all strictly dominated strategies.
b) Find all Nash equilibria.
c) What is the player 1’s best response to the strategy σ2 = (z , ½ , ½ - z) of player 2, where z is a parameter that lies in the closed interval [0, ½].
d) Compute the payoffs to player 1 and to player 2 for their respective strategy profiles σ1 = (0,½,½) and σ2 = (½,0,½).
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