Draw the strategic form game, Macroeconomics

Consider a two-player game where player A chooses "Up," or "Down" and player B chooses "Left," "Center," or "Right". Their player is as follows: When player A chooses "Up" and player B chooses "Left" player A gets $5 while player B gets $2. When player A chooses "Up" and player B chooses "Center" they get $6 and $1 correspondingly, while when player A chooses "Up" and player B chooses "Right" player A gets $7 while player B gets $3. Moreover, when player A chooses "Down" and player B chooses "Left" they get $6 and $2, while when player A chooses "Down" and player B chooses "Center" they both get $1. Finally, when player A chooses "Down" and player B chooses "Right" player A loses $1 and player B gets $1. Assume that the players decide simultaneously (or, in general, when one makes his decision does not know what the other player has chosen).

(a) Draw the strategic form game.

(b) Is there any dominant strategy for any of the players? Justify your answer.

(c) Is there any Nash equilibrium in pure strategies? Justify your answer fully and discuss your result.

When an action is never chosen by a player it is because this action is DOMINATED by another action (or by a combination of other actions). Dominated strategies are assigned a probability of 0 in any Nash Equilibrium in mixed strategies. Given this observation answer the following parts of this problem:

(d) Find the best response functions and the mixed strategies Nash Equilibrium if each player randomizes over his actions.

(e) Show graphically the best responses and the Nash Equilibria (in pure and in mixed strategies).

 

Posted Date: 3/28/2013 5:37:50 AM | Location : United States







Related Discussions:- Draw the strategic form game, Assignment Help, Ask Question on Draw the strategic form game, Get Answer, Expert's Help, Draw the strategic form game Discussions

Write discussion on Draw the strategic form game
Your posts are moderated
Related Questions
Define the term- inflation Inflation between two points in time is defined as the percentage increase of price index between these two points in time.

Examine two (2) tenets of the mercantilist school. Determine whether you agree or disagree with these principles. Provide at least two (2) reasons to support your answer

Consider Gold-Bernstein's Integration roadmap (p. 18).  Construct two business examples, one that clearly calls for a strategic integration effort and the other that call

Desired Aggregate Spending Desired aggregate spending refers to the volume of purchases of the currently produced goods and services that all spending units in the economy wish

Q. Equilibrium in the labor market? Equilibrium in the labor market  Real wage W/P will be equal to the equilibrium real wage in the classical model

Q. Show the investment function in the IS-LM model? The investment function in the IS-LM model Investment was an exogenous variable in cross model owing to the fact that

Manufacturer is considering purchasing equipment, which will have the following financial effects: Year Disbursements Receipts 0 $4400 $0 1 660 880 2 660 1980 3 440 2420 4 220 1760

Explain modern theory of rent eith diagrams and defination

Differences between absolute advantage and comparative advantage?              Ans) Absolute benefit and comparative benefit are two basic concepts to international trade. Under

Suppose you belong to a tennis club that has a monthly fee of $75 and a charge of $5 per hour to play tennis.