Keep Quota Firm Y Cheat 2 Keep X profit $25,000 X profit--$2,000 Quota Y profit $25,000 Y profit - $50,000 Firm X 3 4 X profit $50,000 X profit - $0 Cheat Y profit --$2,000 Y profit -$0 5. (17) Consider the payoff matrix above for a Cartel Game. Each firm has to decide to stick to the agreement or cheat. They start out by both keeping the quota. This is a repeated game (with no end to the game so these are the profits for only one given year but will continue infinitely into the future) and firms can communicate with one another. Each firm must decide each year to either keep the quota or cheat and earn the profit in the equilibrium box for that year (and subsequent years). In this situation will firms have an incentive to cheat? Explain why or why not.

1. Use the following one-shot, normal form game to answer the questions below. Strategy A 100, 125 300, 250 200, 100 250, 0 500, 500 750, 400 400, 300 -100, 350 0, -100 (a) Find each player's dominant strategy, if it exists. (b) Find the Nash equilibrium.

Use 7.3

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You are playing a game with a friend. It’s yourmove but you don’t have a dominant strategy.Your payoff depends on what your friend doesafter your move. You consider flipping a coin todecide what to do. You are about to reach for acoin, but then you realize that your friend has adominant strategy. Explain how using backwardinduction (rather than a coin toss) will now determine your next move

Please explain it. ASAP

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UofC Aggressive Restrained Aggressive 18, 26 29,47 MRU Restrained 45, 59 32, 23 Consider the case of a Sequential-Move game. Uofc moves First Part 1. Is UofC 's sub-game Perfect Nash Equilibrium strategy Aggressive or Restrained? (Answer 1 for aggressive and 2 for Restrained) 1 Part 2. Is MRU's sub-game Perfect Nash Equilibrium strategy Aggressive or Restrained? (Answer 1 for aggressive and 2 for Restrained) Number: Part 3. How much profit does UofC make under the Sub-game perfect Nash-Equilibrium? Number Part 4. How much profit does MRU make under the Sub-game perfect Nash-Equilibrium? Number

t 0886951] Two firms are competing in a market by simultaneously deciding the quality of their manufactured product. The payoff matrix for this competition is depicted in the image. Firm 1 This game can be solved by deleting dominated strategies. Use this tactic to identify all pure-strategy Nash equilibria in this game. Low Medium High 53 54 66 Low A. Firm 1 chooses high and Firm 2 chooses high. 25 34 43 B. Firm 1 chooses low and Firm 2 chooses high. 43 68 77 C. Firm 1 chooses medium and Firm 2 chooses medium. Firm 2 Medium D. Firm 1 chooses medium and Firm 2 chooses low. 12 45 E. Firm 1 chooses low and Firm 2 chooses low. 74 96 89 F. Firm 1 chooses high and Firm 2 chooses low. High G. Firm 1 chooses medium and Firm 2 chooses high. 39 48 H. Firm 1 chooses low and Firm 2 chooses medium. I. Firm 1 chooses high and Firm 2 chooses medium. 50 21

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