Suppose individuals live in villages that are homogeneous by type and a fractions of their interactions takes place in their village, the rest occurring in the city where the types were mixed. The fraction of the population who are cooperators is a. a) Write the expected return functions for cooperate and defect as a function of s and a. b) Under which conditions does an interior equilibrium exist for the fraction of the population playing cooperate (a) c) If the interior equilibrium for a exists, is the interior equilibrium unstable or stable? d) Find the impact of higher s on the interior equilibrium for a. What intuitively does this outcome mean? Discuss your answer.

Suppose individuals live in villages that are homogeneous by type and a fractions of their interactions takes place in their village, the rest occurring in the city where the types were mixed. The fraction of the population who are cooperators is a. a) Write the expected return functions for cooperate and defect as a function of s and a. b) Under which conditions does an interior equilibrium exist for the fraction of the population playing cooperate (a) c) If the interior equilibrium for a exists, is the interior equilibrium unstable or stable? d) Find the impact of higher s on the interior equilibrium for a. What intuitively does this outcome mean? Discuss your answer.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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