What is the probability that both will survive

Reference no: EM133344158

Case: Chris and Pat have dared each other to play a dangerous game of chicken. In the game, they drive towards each other and decide to either swerve or stay. If one swerves and the other stays, they both survive, but the one who swerves loses reputation, while the other gains reputation. If they both swerve, they both maintain their current reputation. If both stay, both die. The payoffs are described in the following table:

		Pat
		Stay	Swerve
Chris	Stay	(-3, -3)	(2, 0)
Chris	Swerve	(0, 2)	(1, 1)

Find all the pure equilibria.
Find all the mixed equilibria. Include a diagram showing the equilibria.
What is the probability that both will survive?

Reference no: EM133344158

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