Explain whether or not the nash equilibria are efficient

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Reference no: EM131244267

Consider the following Bach or Stravinsky coordination game with utilities (URow, UCol):

Table 2: The Bach or Stravinsky Game

Col

L R

Row U 9,3 0,0

D 0,0 4,6

(a) Identify all of the pure-strategy Nash equilibria for this problem. Explain whether or not the Nash equilibria are efficient.

(b) Explain how the government’s role, if one exists, is both to create efficiency and to redistribute wealth.

Reference no: EM131244267

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