(OTHER SOLUTION CONCEPTS) Consider the 4x3 game depicted below. A Г1,2 1,2 0,3] B 4,0 1,3 0,2 с 13,1 2,1 1,2| D Lo, 2 0,1 2,4] (a) What is/are MAXIMIN strategy of PLAYER 1? (b) What is/are MAXIMIN strategy of PLAYER 2? (c) What is/are MINIMAX strategy of PLAYER 1 against PLAYER 2? (d) What is/are MINIMAX strategy of PLAYER 2 against PLAYER 1? (e) What is/are MINIMAX REGRET strategy of PLAYER 1? (f) What is/are MINIMAX REGRET strategy of PLAYER 2?

(OTHER SOLUTION CONCEPTS) Consider the 4x3 game depicted below. A Г1,2 1,2 0,3] B 4,0 1,3 0,2 с 13,1 2,1 1,2| D Lo, 2 0,1 2,4] (a) What is/are MAXIMIN strategy of PLAYER 1? (b) What is/are MAXIMIN strategy of PLAYER 2? (c) What is/are MINIMAX strategy of PLAYER 1 against PLAYER 2? (d) What is/are MINIMAX strategy of PLAYER 2 against PLAYER 1? (e) What is/are MINIMAX REGRET strategy of PLAYER 1? (f) What is/are MINIMAX REGRET strategy of PLAYER 2?

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter8: Game Theory

Section: Chapter Questions

Problem 8.9P

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1. Consider the two-player game described in figure 1. Player 1 has three possible actions to choose from and player 2 has two. The payoffs to each player are shown in the normal-form representation of the game below. (a) Player 2 LR U 5,1 4,0 Player 1 M 6,0 3,1 D 7,3 5,4 Figure 1 Do either players have any dominated strategies? (b) What is the Nash Equilibrium of this game?
3. Consider the following two-player game: H L D T 2,3 0,2 4,0 1,1 (a) What are (pure- and mixed-strategy) Nash equilibria of this game? (b) Suppose the game is repeated twice, and each player's payoff is the sum of the payoffs they obtain in the two periods. What are the subgame perfect equilibria of the game? (c) Suppose the game is repeated indefinitely, and each player discounts his/her payoff with a discount factor 8 € (0, 1). Find a subgame perfect equilibrium in which (H, T) is played in every period on the equilibrium path. Compute the discount factor & needed for this equilibrium. (d) Suppose the game is repeated indefinitely, and each player discounts his/her payoff with a discount factor & € (0, 1). Find a subgame perfect equilibrium in which (H,T) and (L,T) are played alternately on the equilibrium path. Compute the discount factor & needed for this equilibrium. (e) Suppose the game is repeated indefinitely. Player 1 (the row player) discounts her payoff with a discount…
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12. Consider a game where each player picks a number from 0 to 60. The guess that is closest to half ofthe average of the chosen numbers wins a prize. If several peopleare equally close, then they share theprize. The game theory implies that (A) all players have dominant strategies to choose 0 (B) all players have dominant strategies to choose 30 (C) there is a Nash equilibrium where all players pick 0 (D) there is a Nash equilibrium where all players pick positive numbers 13. Behavioral data in such games suggests that (A) most subjects choose 0; (B) most subjects choose 30; (C) common answers include 30, 15, 7.5, and 0; (D) most subjects use randomization. Can you help me answer number 13 please?
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