Find all the bayesian equilibria in the corresponding game

Assignment Help Game Theory

Reference no: EM131332551

Nicolas would like to sell a company that he owns to Marc. The company's true value is an integer between 10 and 12 (including 10 and 12), in millions of dollars. Marc has to make a take-it-or-leave-it offer, and Nicolas has to decide whether to accept the offer or reject it. If Nicolas accepts the offer, the company is sold, Nicolas's payoff is the amount that he got, and Marc's payoff is the difference between the company's true value and the amount that he paid.

If Nicolas rejects the offer, the company is not sold, Nicolas's payoff is the value of the company, and Marc's payoff is 0.

For each one of the following three information structures, describe the situation as a game with incomplete information, and find all the Bayesian equilibria in the corresponding game.

In each case, the description of the situation is common knowledge among the players. In determining Nicolas's action set, note that Nicolas knows what Marc's offer is when he decides whether or not to accept the offer.

(a) Neither Nicolas nor Marc knows the company's true value; both ascribe probability 1/3 to each possible value.

(b) Nicolas knows the company's true value, whereas Marc does not know it, and ascribes probability 1/3 to each possible value.

(c) Marc does not know the company's worth and ascribes probability 1/3 to each possible value. Marc further ascribes probability p to the event that Nicolas knows the value of the company, and probability 1 - p to the event that Nicolas does not know the value of the company, and instead ascribes probability 1/3 to each possible value.

Reference no: EM131332551

Questions Cloud

Two-tailed test for the population proportion : Using the confidence interval when conducting a two-tailed test for the population proportion p, we reject the null hypothesis if the hypothesized value for p falls inside the confidence interval.

Find two bayesian equilibria in pure strategies : Depict this situation as a Harsanyi game with incomplete information.- List the pure strategies of the two players.- Find two Bayesian equilibria in pure strategies.

Depict the situation as a harsanyi game : Depict this situation as a Harsanyi game with incomplete information, and for each pair of parameters p and q, find all the Bayesian equilibria.

Write down a laissezfaire response and a democratic response : You have been meeting with a student-faculty committee that is charged with finding a musical group for the annual homecoming celebration. The group has expressed a variety of different suggestions, and little agreement has been apparent. You are ..

Find all the bayesian equilibria in the corresponding game : Describe the situation as a game with incomplete information, and find all the Bayesian equilibria in the corresponding game.

What were the factors that caused actual quarterly income : What were the factors that caused actual quarterly income to be less than budgeted? Quantify the effect of each of these factors. Be as specific as possible.

Discuss about the hr planning management : From the e-Activity, recommend two (2) actions that HR managers can take in order to prepare their employees for work in a foreign country. Justify your response.From the scenario, select a country then examine an issue that may occur during the H..

Confidence interval of the average weight of loaves : Can the bakery's claimbe rejected at 10% significance level? Explain. Then, calculate the 90% confidence interval of the average weight of loaves of bread.

What is the test value for hypothesis test : He surveys a sample of 40 students and finds that for the most recent semester their average cost was $430 with a standard deviation of $80. What is the test value for this hypothesis test?

User Account

All Pages