Find the backward induction equilibrium, Applied Statistics

A rightist incumbent (player I) and a leftist challenger (player C) run for senate. Each candidate chooses among two possible political platforms: Left or Right. The rules of the game are the following:

- If both choose the same platform, the incumbent wins the election and if they choose di erent platforms the challenger wins the election.

- The payo for winning the election is 2 and the payo of losing is 0 for each candidate.

- Moreover, candidates do not like to compromise their views. Therefore, independently of whether they win or not, they get an extra payo of 1 (that is, on top of the 0 or 2 mentioned above) if they propose the platform they like best.

(a) Draw the tree if:

(a-1) The Incumbent moves rst

(a-2) The Challenger moves rst

(a-3) The Incumbent and the Challenger move simultaneously

(b) Find the Backward induction equilibrium in cases (a-1) and (a-2) and the (pure and/or mixed strategy) Nash equilibria in case (a-3). Find the payo s of each candidate in each case.

(c) Interpret the results (important).

Posted Date: 3/14/2013 3:38:43 AM | Location : United States







Related Discussions:- Find the backward induction equilibrium, Assignment Help, Ask Question on Find the backward induction equilibrium, Get Answer, Expert's Help, Find the backward induction equilibrium Discussions

Write discussion on Find the backward induction equilibrium
Your posts are moderated
Related Questions
Steps in ANOVA The three steps which constitute the analysis of variance are as follows: To determine an estimate of the population variance from the variance that exi

Formation of Continuous Frequency Distribution:    Continuous frequency distribution is most popular in practice. With reference to the formation of this type of frequency distr

why we use dummy variable

In PCA the eigknvalues must ultimately account for all of the variance. There is no probability,'no hypothesis, no test because strictly speaking PCA is not a statistical procedure

Quota sampling Under this method enumerators shall select the respondents in place of those not available, as per the quota fixed according  to guide lines   provided to them.

Type of Variable in Regression Analysis There are two types of variable in regression analysis. These are: a.      Dependent variable b.      Independent variable

The project of building a backyard swimming pool consists of eight major activities and has to be completed within 19 weeks. The activities and related data are given in the follow

Let X, Y, and Z refer to the three random variables. It is known that Var(X) = 4, Var(Y) = 9, and Var(Z) = 16. It is further known that E(X) = 1, E(Y) = 2, and E(Z) = 4. Furthermor

Hi There, I have a question regarding R, and I am wondering if anyone can help me. Here is a code that I would like to understand: squareFunc g f(x)^2 } return(g) } sin

There are n seats on an airplane and n passengers have bought tickets. Unfortunately, the first passenger to enter the plane has lost his ticket and, so he just chooses a seat at r