Consider the following prisoners' dilemma game.
C
D
4,4
0,6
6,0
1,1
Suppose that this game is repeated innately and consider the following Tit-for-tat" strategy:
Choose C in period 1 and then do whatever your opponent did last period".
(a) For what values of δ, if any, both players choosing the \Tit-for-tat" strategy is a SPE?
Consider now the \Pavlov" strategy: \Choose C in period 1. Choose C after any history in which the outcome in the last period is either (C;C) or (D;D). Choose D after any other history."
(b) For what values of δ, if any, both players choosing the \Pavlov" strategy is a SPE?