Draw the strategic form game, Macroeconomics

Assignment Help:

Consider a two-player game where player A chooses "Up," or "Down" and player B chooses "Left," "Center," or "Right". Their player is as follows: When player A chooses "Up" and player B chooses "Left" player A gets $5 while player B gets $2. When player A chooses "Up" and player B chooses "Center" they get $6 and $1 correspondingly, while when player A chooses "Up" and player B chooses "Right" player A gets $7 while player B gets $3. Moreover, when player A chooses "Down" and player B chooses "Left" they get $6 and $2, while when player A chooses "Down" and player B chooses "Center" they both get $1. Finally, when player A chooses "Down" and player B chooses "Right" player A loses $1 and player B gets $1. Assume that the players decide simultaneously (or, in general, when one makes his decision does not know what the other player has chosen).

(a) Draw the strategic form game.

(b) Is there any dominant strategy for any of the players? Justify your answer.

(c) Is there any Nash equilibrium in pure strategies? Justify your answer fully and discuss your result.

When an action is never chosen by a player it is because this action is DOMINATED by another action (or by a combination of other actions). Dominated strategies are assigned a probability of 0 in any Nash Equilibrium in mixed strategies. Given this observation answer the following parts of this problem:

(d) Find the best response functions and the mixed strategies Nash Equilibrium if each player randomizes over his actions.

(e) Show graphically the best responses and the Nash Equilibria (in pure and in mixed strategies).

 


Related Discussions:- Draw the strategic form game

What is national income, Recognize which of the following purchases is coun...

Recognize which of the following purchases is counted as a part of NI: a) Tata motors purchases tire from Good year to equip latest Indica. b) Tata motors purchases tires fr

Describe the structural unemployment, Describe the Structural unemployment ...

Describe the Structural unemployment Individuals who are unemployed as their skills are no longer in demand where they live. This kind mainly results in longer spells and may r

Find the equilibrium quantities and prices , Consider the following simple ...

Consider the following simple economy which consists of two industries, guns (1) and butter (2) and is characterized by the following input-output matrix. Suppose also that

Health care and income transfers, During the past five decades, there has b...

During the past five decades, there has been a shift in the composition of the federal budget toward more spending on income transfers and health care and a smaller share for natio

What do you mean by gross domestic product, What do you mean by Gross Domes...

What do you mean by Gross Domestic Product? Gross Domestic Product: GDP stands for Gross domestic product, measures the value of all concluding goods and services produce

The core of macroeconomics, Suppose in the Republic of Madison that the reg...

Suppose in the Republic of Madison that the regulation of banking rested with the Madison Congress, including the determination of the reserve ratio. The Central Bank of Madison is

Eco, illustrate and discuss the implications of various market structures (...

illustrate and discuss the implications of various market structures (competitive and non-competitive)for price determination.

Grocery store manager, A grocery store manager would like to have an idea c...

A grocery store manager would like to have an idea concerning the average amount milk the store sells per day. In a sample of 70 days, the average amount number of gallons sold was

#title. phillip curve, what does phillip curve signify? how do you reconcil...

what does phillip curve signify? how do you reconcile the difference in the shap of the curve in the short run and the long run?

Partial equilibrium and surplus, The city of Cabernet is very famous for it...

The city of Cabernet is very famous for its production of wine. The inhabitants of the city have an aggregate demand for wine that can be described as follows: D(p) = Q d =150-

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd