**Game Theory Exercise: Simultaneous Game Analysis**Consider the following simultaneous game between Player 1 and Player 2:| | Player 2 L | Player 2 R ||----------|------------|------------|| Player 1 U | (30, 20) | (-10, -10) || Player 1 D | (-10, -10) | (20, 30) |### Instructions:Please indicate whether each of the following statements is true or false.1. **Player 1 has a dominant strategy.** - [Dropdown for True/False]2. **This game has two Nash equilibria in pure strategies.** - [Dropdown for True/False]3. **Player 1's payoff in each of the Nash equilibria is 30.** - [Dropdown for True/False]### Explanation of the Payoff Matrix:- **Player 1** can choose between two strategies: U (Up) or D (Down).- **Player 2** can choose between two strategies: L (Left) or R (Right).- The numbers in the cells represent payoffs, with Player 1's payoff listed first, followed by Player 2's payoff.### Potential Analysis:- **Strategies**: - U for Player 1 can yield payoffs of 30 with L and -10 with R for Player 2. - D for Player 1 can yield payoffs of -10 with L and 20 with R for Player 2. - **Nash Equilibrium**: - Identify any stable states where neither player benefits from changing their strategy unilaterally. Use the dropdowns to select True or False for each statement about the game.

Nash equilibrium is where the two player plays their best response and get to a decision. Dominant…

Consider the following simultaneous game: Player 1 U D Player 2 L 30,20 -10, -10 R -10, -10 20,30 Please indicate whether each of the following statements is true or false. Player 1 has a dominant strategy. This game has two Nash equilibria in pure strategies. Player 1's payoff in each of the Nash equilibria is 30.

Consider the following simultaneous game: Player 1 U D Player 2 L 30,20 -10, -10 R -10, -10 20,30 Please indicate whether each of the following statements is true or false. Player 1 has a dominant strategy. This game has two Nash equilibria in pure strategies. Player 1's payoff in each of the Nash equilibria is 30.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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