Someone at a party pulls out a $100 bill and announces that he is going to auction it off. There are n=10 people at the party who are potential bidders. The owner of the $100 bill puts forth the following procedure: All bidders simultaneously submit a written bid. Only the highest bidders pay their bid (assuming that the highest bid is positive). If m people submit the highest bid, then each receives 1/m of the $100. Each person’s strategy set is {0,1,2,...,1000}{0,1,2,...,1000} so bidding can go as high as $1,000. The payoff of a player bidding bi is: 0 if bi < max{b1,b2,…,bn}, and 100/m − bi if bi = max {b1,b2,…,bn} where,m is the number of bidders whose bid equals max{b1,...,bn}. How many pure-strategy Nash equilibria does this game have? 1) 0 2) 1 3) 4 4) More than 4.
Someone at a party pulls out a $100 bill and announces that he is going to auction it off. There are n=10 people at the party
who are potential bidders. The owner of the $100 bill puts forth the following procedure: All bidders simultaneously submit a written bid. Only the highest bidders pay their bid (assuming that the highest bid is positive). If m people submit the highest bid, then each receives 1/m of the $100. Each person’s strategy set is {0,1,2,...,1000}{0,1,2,...,1000} so bidding can go as high as $1,000.
The payoff of a player bidding bi is:
0 if bi < max{b1,b2,…,bn},
and
100/m − bi if bi = max {b1,b2,…,bn}
where,m is the number of bidders whose bid equals max{b1,...,bn}.
How many pure-strategy Nash equilibria does this game have?
| 1) | 0 | |
| 2) | 1 | |
| 3) | 4 | |
| 4) | More than 4. |
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