2. Consider the following 2 → 2 normal form games: In both games Player 1 (the row player) chooses either strategy A or strategy B. Player 2 (the column player) chooses simultaneously strategy A or B. The outcomes are defined by the following matrices. The first number in each cell indicates the payoff of Player 1, the second number (after the comma) indicates the payoff of Player 2. A B Game I A B 50X, 30X 10X, 10X 10X, 10X 30X, 50X Game II A A 110X, 30X B 10X, 10X B 10X, 10X 30X, 50X where X > 0 is a payoff scale parameter. (a) For both games: find all Nash equilibria in pure strategies, if any, and find the Nash equilibrium in mixed strategies. How would you describe this strategic interaction in the two games?

2. Consider the following 2 → 2 normal form games: In both games Player 1 (the row player) chooses either strategy A or strategy B. Player 2 (the column player) chooses simultaneously strategy A or B. The outcomes are defined by the following matrices. The first number in each cell indicates the payoff of Player 1, the second number (after the comma) indicates the payoff of Player 2. A B Game I A B 50X, 30X 10X, 10X 10X, 10X 30X, 50X Game II A A 110X, 30X B 10X, 10X B 10X, 10X 30X, 50X where X > 0 is a payoff scale parameter. (a) For both games: find all Nash equilibria in pure strategies, if any, and find the Nash equilibrium in mixed strategies. How would you describe this strategic interaction in the two games?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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