Each player’s dominant strategy.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 10, Problem 1CACQ

a

To determine

To find:Each player’s dominant strategy.

a

Expert Solution

Explanation of Solution

Tabular presentation of player 1 and 2 game.

Player 2
Player 1		D	E	F
	A	-200,150	350,100	-50,600
	B	200,-300	400,400	300,100
	C	-150,200	-250,550	750,-350

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

According to the table,

Selection by Player 2	Reaction of player 1
D	B
E	B
F	C

It is noted that, when player 2 selects D, for getting the maximum payoff, player 1 selects B. Similarly, If E is selected by 2ⁿ^d player, 1 will choose B and so on. Thus, no dominant strategy exists for player 2 as player 2 choices rely on player 1 moves.

Thus, dominant strategy does not occur as players do not have independent moves.

Economics Concept Introduction

Introduction:

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

b)

To determine

To ascertain: Each player secure strategy.

b)

Expert Solution

Explanation of Solution

According to the game, there are various moves available for player second.

When player 2 choses strategy D, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is $-200 and at strategy C, worst outcome is -150.

When player 2 choses strategy E, player 1 has a worst outcome of -50 when strategy E is selected.

When player 2 choses strategy F, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is -50 and at strategy C, worst outcome is -350.

To get the secure strategy, maximum payoff available which is $200, $400 or $300 when strategy B is selected. Hence, strategy B is considered as secure strategy for player 1.

Economics Concept Introduction

Introduction:

A strategy is secure when any deviation from player 2 does not affect the payoff of player 1 having no dominant strategy.

c)

To determine

To ascertain: The Nash equilibrium.

c)

Expert Solution

Explanation of Solution

Nash equilibrium occurs when both players are maximizing their payoffs given other player’s move.

Therefore, Nash equilibrium occurs when player A choses B strategy while player B choses strategy E which gives payoff equal to each player.

Therefore, the Nash equilibrium in the game is (B,E).

Economics Concept Introduction

Introduction:

Nash equilibrium is a stable state in which different participants interact each other, in which no participant gain unilaterally, if strategy of other remains unchanged.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Wolfgang is a typical producer in a perfectly competitive piano industry (i.e., all other producers of pianos face the same costs as Wolfgang). The following production and cost data apply to the long run as well as the short run. Fixed costs (rent) are unrecoverable in the short run and are equal to $2400 per month. Variable costs consist of raw materials (wire, wood, plastic), which cost $1000 per piano, and the $40 per hour opportunity cost of Wolfgang's time. Wolfgang's production function is given in the table at right. Wolfgang will shut down if the price per piano is less than OA. $3000. B. $4000. O C. $5000. ○ D. None of the above. Pianos (Q) Hours (L) Raw Materials ( 0 0 0 1 100 1000 2 150 2000 3 240 3000 4 400 4000

P2 P₁ $ per unit Using the graph below, determine which statement is TRUE. MC1 SRATC₁ Q1 Q₂ MC2 SRATC2 LRAC ✓ LEA Quantity

Using the grapns below, wnicn snow the snort-run cost curves for 3 perfectly competitive firms in the same industry, determine whether the industry is in long-run equilibrium or not. Q Q Firm A QA MC ATC Output Firm B QB MC ATC Firm C MC ATC Output Output Qc If Firms A, B and C are in the same industry, is this industry in long-run equilibrium? ○ A. Yes, because P = MC = MR for each of the 3 firms. ○ B. No, because Firm A is not producing at a profit-maximizing level of output. ○ C. Yes, because all 3 firms are producing at their minimum average total cost. OD. The answer is uncertain since it's unknown whether the firms are producing at the minimum efficient scale or not. ○ E. No, because if the industry were in equilibrium, all 3 firms would be earning zero economic profits.

Answer 2

Question

Chapter 10, Problem 1CACQ

a

To determine

To find:Each player’s dominant strategy.

a

Expert Solution

Explanation of Solution

Tabular presentation of player 1 and 2 game.

Player 2
Player 1		D	E	F
	A	-200,150	350,100	-50,600
	B	200,-300	400,400	300,100
	C	-150,200	-250,550	750,-350

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

According to the table,

Selection by Player 2	Reaction of player 1
D	B
E	B
F	C

It is noted that, when player 2 selects D, for getting the maximum payoff, player 1 selects B. Similarly, If E is selected by 2ⁿ^d player, 1 will choose B and so on. Thus, no dominant strategy exists for player 2 as player 2 choices rely on player 1 moves.

Thus, dominant strategy does not occur as players do not have independent moves.

Economics Concept Introduction

Introduction:

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

b)

To determine

To ascertain: Each player secure strategy.

b)

Expert Solution

Explanation of Solution

According to the game, there are various moves available for player second.

When player 2 choses strategy D, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is $-200 and at strategy C, worst outcome is -150.

When player 2 choses strategy E, player 1 has a worst outcome of -50 when strategy E is selected.

When player 2 choses strategy F, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is -50 and at strategy C, worst outcome is -350.

To get the secure strategy, maximum payoff available which is $200, $400 or $300 when strategy B is selected. Hence, strategy B is considered as secure strategy for player 1.

Economics Concept Introduction

Introduction:

A strategy is secure when any deviation from player 2 does not affect the payoff of player 1 having no dominant strategy.

c)

To determine

To ascertain: The Nash equilibrium.

c)

Expert Solution

Explanation of Solution

Nash equilibrium occurs when both players are maximizing their payoffs given other player’s move.

Therefore, Nash equilibrium occurs when player A choses B strategy while player B choses strategy E which gives payoff equal to each player.

Therefore, the Nash equilibrium in the game is (B,E).

Economics Concept Introduction

Introduction:

Nash equilibrium is a stable state in which different participants interact each other, in which no participant gain unilaterally, if strategy of other remains unchanged.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 10, Problem 1CACQ

a

To determine

To find:Each player’s dominant strategy.

a

Expert Solution

Explanation of Solution

Tabular presentation of player 1 and 2 game.

Player 2
Player 1		D	E	F
	A	-200,150	350,100	-50,600
	B	200,-300	400,400	300,100
	C	-150,200	-250,550	750,-350

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

According to the table,

Selection by Player 2	Reaction of player 1
D	B
E	B
F	C

It is noted that, when player 2 selects D, for getting the maximum payoff, player 1 selects B. Similarly, If E is selected by 2ⁿ^d player, 1 will choose B and so on. Thus, no dominant strategy exists for player 2 as player 2 choices rely on player 1 moves.

Thus, dominant strategy does not occur as players do not have independent moves.

Economics Concept Introduction

Introduction:

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

b)

To determine

To ascertain: Each player secure strategy.

b)

Expert Solution

Explanation of Solution

According to the game, there are various moves available for player second.

When player 2 choses strategy D, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is $-200 and at strategy C, worst outcome is -150.

When player 2 choses strategy E, player 1 has a worst outcome of -50 when strategy E is selected.

When player 2 choses strategy F, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is -50 and at strategy C, worst outcome is -350.

To get the secure strategy, maximum payoff available which is $200, $400 or $300 when strategy B is selected. Hence, strategy B is considered as secure strategy for player 1.

Economics Concept Introduction

Introduction:

A strategy is secure when any deviation from player 2 does not affect the payoff of player 1 having no dominant strategy.

c)

To determine

To ascertain: The Nash equilibrium.

c)

Expert Solution

Explanation of Solution

Nash equilibrium occurs when both players are maximizing their payoffs given other player’s move.

Therefore, Nash equilibrium occurs when player A choses B strategy while player B choses strategy E which gives payoff equal to each player.

Therefore, the Nash equilibrium in the game is (B,E).

Economics Concept Introduction

Introduction:

Nash equilibrium is a stable state in which different participants interact each other, in which no participant gain unilaterally, if strategy of other remains unchanged.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 10, Problem 1CACQ

a

To determine

To find:Each player’s dominant strategy.

a

Expert Solution

Explanation of Solution

Tabular presentation of player 1 and 2 game.

Player 2
Player 1		D	E	F
	A	-200,150	350,100	-50,600
	B	200,-300	400,400	300,100
	C	-150,200	-250,550	750,-350

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

According to the table,

Selection by Player 2	Reaction of player 1
D	B
E	B
F	C

It is noted that, when player 2 selects D, for getting the maximum payoff, player 1 selects B. Similarly, If E is selected by 2ⁿ^d player, 1 will choose B and so on. Thus, no dominant strategy exists for player 2 as player 2 choices rely on player 1 moves.

Thus, dominant strategy does not occur as players do not have independent moves.

Economics Concept Introduction

Introduction:

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

b)

To determine

To ascertain: Each player secure strategy.

b)

Expert Solution

Explanation of Solution

According to the game, there are various moves available for player second.

When player 2 choses strategy D, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is $-200 and at strategy C, worst outcome is -150.

When player 2 choses strategy E, player 1 has a worst outcome of -50 when strategy E is selected.

When player 2 choses strategy F, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is -50 and at strategy C, worst outcome is -350.

To get the secure strategy, maximum payoff available which is $200, $400 or $300 when strategy B is selected. Hence, strategy B is considered as secure strategy for player 1.

Economics Concept Introduction

Introduction:

A strategy is secure when any deviation from player 2 does not affect the payoff of player 1 having no dominant strategy.

c)

To determine

To ascertain: The Nash equilibrium.

c)

Expert Solution

Explanation of Solution

Nash equilibrium occurs when both players are maximizing their payoffs given other player’s move.

Therefore, Nash equilibrium occurs when player A choses B strategy while player B choses strategy E which gives payoff equal to each player.

Therefore, the Nash equilibrium in the game is (B,E).

Economics Concept Introduction

Introduction:

Nash equilibrium is a stable state in which different participants interact each other, in which no participant gain unilaterally, if strategy of other remains unchanged.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 10, Problem 1CACQ

a

To determine

To find:Each player’s dominant strategy.

a

Expert Solution

Explanation of Solution

Tabular presentation of player 1 and 2 game.

Player 2
Player 1		D	E	F
	A	-200,150	350,100	-50,600
	B	200,-300	400,400	300,100
	C	-150,200	-250,550	750,-350

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

According to the table,

Selection by Player 2	Reaction of player 1
D	B
E	B
F	C

It is noted that, when player 2 selects D, for getting the maximum payoff, player 1 selects B. Similarly, If E is selected by 2ⁿ^d player, 1 will choose B and so on. Thus, no dominant strategy exists for player 2 as player 2 choices rely on player 1 moves.

Thus, dominant strategy does not occur as players do not have independent moves.

Economics Concept Introduction

Introduction:

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

b)

To determine

To ascertain: Each player secure strategy.

b)

Expert Solution

Explanation of Solution

According to the game, there are various moves available for player second.

When player 2 choses strategy D, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is $-200 and at strategy C, worst outcome is -150.

When player 2 choses strategy E, player 1 has a worst outcome of -50 when strategy E is selected.

When player 2 choses strategy F, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is -50 and at strategy C, worst outcome is -350.

To get the secure strategy, maximum payoff available which is $200, $400 or $300 when strategy B is selected. Hence, strategy B is considered as secure strategy for player 1.

Economics Concept Introduction

Introduction:

A strategy is secure when any deviation from player 2 does not affect the payoff of player 1 having no dominant strategy.

c)

To determine

To ascertain: The Nash equilibrium.

c)

Expert Solution

Explanation of Solution

Nash equilibrium occurs when both players are maximizing their payoffs given other player’s move.

Therefore, Nash equilibrium occurs when player A choses B strategy while player B choses strategy E which gives payoff equal to each player.

Therefore, the Nash equilibrium in the game is (B,E).

Economics Concept Introduction

Introduction:

Nash equilibrium is a stable state in which different participants interact each other, in which no participant gain unilaterally, if strategy of other remains unchanged.

Answer 6

Chapter 10, Problem 1CACQ

a

To determine

To find:Each player’s dominant strategy.

a

Expert Solution

Explanation of Solution

Tabular presentation of player 1 and 2 game.

Player 2
Player 1		D	E	F
	A	-200,150	350,100	-50,600
	B	200,-300	400,400	300,100
	C	-150,200	-250,550	750,-350

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

According to the table,

Selection by Player 2	Reaction of player 1
D	B
E	B
F	C

It is noted that, when player 2 selects D, for getting the maximum payoff, player 1 selects B. Similarly, If E is selected by 2ⁿ^d player, 1 will choose B and so on. Thus, no dominant strategy exists for player 2 as player 2 choices rely on player 1 moves.

Thus, dominant strategy does not occur as players do not have independent moves.

Economics Concept Introduction

Introduction:

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

Answer 7

Chapter 10, Problem 1CACQ

a

To determine

To find:Each player’s dominant strategy.

Answer 8

a

Expert Solution

Explanation of Solution

Tabular presentation of player 1 and 2 game.

Player 2
Player 1		D	E	F
	A	-200,150	350,100	-50,600
	B	200,-300	400,400	300,100
	C	-150,200	-250,550	750,-350

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

According to the table,

Selection by Player 2	Reaction of player 1
D	B
E	B
F	C

It is noted that, when player 2 selects D, for getting the maximum payoff, player 1 selects B. Similarly, If E is selected by 2ⁿ^d player, 1 will choose B and so on. Thus, no dominant strategy exists for player 2 as player 2 choices rely on player 1 moves.

Thus, dominant strategy does not occur as players do not have independent moves.

Answer 9

a

Expert Solution

Answer 10

a

Expert Solution

Answer 11

Expert Solution

Answer 12

Economics Concept Introduction

Introduction:

Dominant strategy is the selection of move in the game which pays the maximum payoff given other player strategy.

Answer 13

b)

To determine

To ascertain: Each player secure strategy.

b)

Expert Solution

Explanation of Solution

According to the game, there are various moves available for player second.

When player 2 choses strategy D, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is $-200 and at strategy C, worst outcome is -150.

When player 2 choses strategy E, player 1 has a worst outcome of -50 when strategy E is selected.

When player 2 choses strategy F, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is -50 and at strategy C, worst outcome is -350.

To get the secure strategy, maximum payoff available which is $200, $400 or $300 when strategy B is selected. Hence, strategy B is considered as secure strategy for player 1.

Economics Concept Introduction

Introduction:

A strategy is secure when any deviation from player 2 does not affect the payoff of player 1 having no dominant strategy.

Answer 14

b)

To determine

To ascertain: Each player secure strategy.

Answer 15

b)

Expert Solution

Explanation of Solution

According to the game, there are various moves available for player second.

When player 2 choses strategy D, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is $-200 and at strategy C, worst outcome is -150.

When player 2 choses strategy E, player 1 has a worst outcome of -50 when strategy E is selected.

When player 2 choses strategy F, Player 1 has two options, that is, strategy A and C. With selection of A strategy, worst outcome is -50 and at strategy C, worst outcome is -350.

To get the secure strategy, maximum payoff available which is $200, $400 or $300 when strategy B is selected. Hence, strategy B is considered as secure strategy for player 1.

Answer 16

b)

Expert Solution

Answer 17

b)

Expert Solution

Answer 18

Expert Solution

Answer 19

Economics Concept Introduction

Introduction:

A strategy is secure when any deviation from player 2 does not affect the payoff of player 1 having no dominant strategy.

Answer 20

c)

To determine

To ascertain: The Nash equilibrium.

c)

Expert Solution

Explanation of Solution

Nash equilibrium occurs when both players are maximizing their payoffs given other player’s move.

Therefore, Nash equilibrium occurs when player A choses B strategy while player B choses strategy E which gives payoff equal to each player.

Therefore, the Nash equilibrium in the game is (B,E).

Economics Concept Introduction

Introduction:

Nash equilibrium is a stable state in which different participants interact each other, in which no participant gain unilaterally, if strategy of other remains unchanged.

Answer 21

c)

To determine

To ascertain: The Nash equilibrium.

Answer 22

c)

Expert Solution

Explanation of Solution

Nash equilibrium occurs when both players are maximizing their payoffs given other player’s move.

Therefore, Nash equilibrium occurs when player A choses B strategy while player B choses strategy E which gives payoff equal to each player.

Therefore, the Nash equilibrium in the game is (B,E).

Answer 23

c)

Expert Solution

Answer 24

c)

Expert Solution

Answer 25

Expert Solution

Answer 26

Economics Concept Introduction

Introduction:

Nash equilibrium is a stable state in which different participants interact each other, in which no participant gain unilaterally, if strategy of other remains unchanged.

Answer 27

Ch. 10 - Prob. 1CACQ Ch. 10 - Prob. 2CACQ Ch. 10 - Prob. 3CACQ Ch. 10 - Prob. 4CACQ Ch. 10 - Prob. 5CACQ Ch. 10 - Prob. 6CACQ Ch. 10 - Prob. 7CACQ Ch. 10 - Prob. 8CACQ Ch. 10 - Prob. 9CACQ Ch. 10 - Prob. 10CACQ

Each player’s dominant strategy.

To find:Each player’s dominant strategy.

Explanation of Solution

To ascertain: Each player secure strategy.

Explanation of Solution

To ascertain: The Nash equilibrium.

Explanation of Solution

Want to see more full solutions like this?

Chapter 10 Solutions