Prove that is the only perfect equilibrium in pure strategy

Assignment Help Game Theory

Reference no: EM131332315

(a) Prove that (T,L) is the only perfect equilibrium in pure strategies of the following game.

1202_Matrix 4.jpg

(b) Prove that in the following game, which is obtained from the game in part (a) by adding a dominated pure strategy to each player, (B,M) is a perfect equilibrium.

80_Matrix 5.jpg

Reference no: EM131332315

Questions Cloud

Cash flows for two mutally exclusive projects : Below are the cash flows for two mutally exclusive projects. Draw NPV profiles for both projects on the same plane. Which project would you choose if the opportunity cost of capital is 2%? Which project would you choose if the opportunity cost of cap..

What are the four elements of firm credit policy : What are the four elements of a firm's credit policy? Why are they important? To what extent can firms set their own credit policies as opposed to accepting policies that are dictated by their competitors?

What economic factors play into creating jobs : What economic factors play into creating jobs? A corporation/business needs to have customers in order to hire workers. How do interest rates affect available jobs?

Earnings per share of barnes enterprises changed : a. If all the shares of the Noble Corporation are exchanged for those of Barnes Enterprises on a share-for-share basis, what will postmerger earnings per share be for Barnes Enterprises? Use an approach similar to that in Table 20-3. b. Explain wh..

Prove that is the only perfect equilibrium in pure strategy : Prove that in the given game, which is obtained from the game in part (a) by adding a dominated pure strategy to each player, (B,M) is a perfect equilibrium.

Calculate return on common equity : Calculate return on common equity for 2014 using year-end amounts and assuming no preferred dividends. Disaggregate the ROCE into operating (RNOA) and non-operating components. Comment on Merck's use of leverage. (Assume all assets and current liabil..

Binomial option pricing model by dividing the life of option : The current price of a non-dividend stock is $50. The stock price is expected to either rise 20% or fall 20% each year and the annually compounded risk-free rate is 5% p.a. The option has 2 years to expiration and the exercise price of the option is ..

Compute the current price of the stock : The Carlton Corporation has $5 million in earnings after taxes and 2 million shares outstanding. The stock trades at a P/E of 20. The firm has $4 million in excess cash. a. Compute the current price of the stock. b. If the $4 million is used to pay..

Annual yield you anticipate for investment recommendation : nvestment Strategy J. D. Williams, Inc. is an investment advisory firm that manages more than $120 million in funds for its numerous clients. The company uses an asset allocation model that recommends the portion of each client’s portfolio to be inve..

User Account

All Pages