5. Consider the following game:LR3,1-2,-12,01,41C 1,-1D 0,-12,04,0a. Find all pure NE.b. There is a unique MNE. Find it and show why there is no otherone.c. Since the outcome (A, R) prescribes negative payoffs for bothplayers, a natural conjecture might be to think that the followingdistribution over outcomes is a correlated equilibrium. Is it so?LRA 1/3B 1/3 1/3CD2)A.

1/2LRA3, 1-2, -1B2, 01, 4C1, -12, 0D0, -14, 0

Answered: 5. Consider the following game: 1 L 3,1…

5. Consider the following game: 1 L 3,1 2,0 C 1,-1 D 0,-1 ABCD A 2 R -2,-1 1,4 2,0 4,0 a. Find all pure NE. b. There is a unique MNE. Find it and show why there is no other one.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

5. Consider the following game:
L
R
3,1
-2,-1
2,0
1,4
1
C 1,-1
D 0,-1
2,0
4,0
a. Find all pure NE.
b. There is a unique MNE. Find it and show why there is no other
one.
c. Since the outcome (A, R) prescribes negative payoffs for both
players, a natural conjecture might be to think that the following
distribution over outcomes is a correlated equilibrium. Is it so?
L
R
A 1/3
B 1/3 1/3
C
D
2)
A.

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