Calculate each players expected payoff in the equilibrium

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Reference no: EM133341673

Question: Player I holds a black Ace and a red 8. Player II holds a red 2 and a black 7. The players simultaneously choose a card to play. If the chosen cards are of the same color, Player I wins. Player II wins if the cards are of different colors. The amount won is a number of dollars equal to the number on the winner's card (Ace counts as 1.) Thus, if Player I plays black Ace while Player II plays red 2, Player I gets a payoff of -2 (loses two dollars), and Player II gets a payoff of 2 (wins two dollars); and likewise for the other strategy profiles. Set up the payoff matrix, find the Nash equilibrium (pure and mixed), and calculate each player's expected payoff in the equilibrium.

Reference no: EM133341673

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