4. Consider the following simultaneous stage game that is play twice. That is, there are two periods, and in each period the two players choose their actions simultaneously. The outcome in the first period is revealed before the players make their choices in the second period. Outline how in a subgame perfect equilibrium, it is possible to get (B, B) as the choice made in the first period. Explain the relevance to trust in organisations. A 1,1 0,6 0,0 6,0 5,5 0,0 C 0,0 0,0 3,3
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- 7 Consider the following static Bayesian game: 1. Nature determines whether the payoffs are as in Game 1 or as in Game 2, each game being equally likely. T 2. Column player learns whether nature has drawn Game 1 or Game 2, but Row player does not. B 3. Row player chooses either T or B. Column player simultaneously chooses either L or R. 4. The payoffs are given by the game drawn by nature. Column L R T 1,1 0, 0 B 0,0 0,0 Game 1, Pr(A) = 1/2 Row a) True or false? The static Bayesian game defined above has asymmetric information. b) How many types does the Row player have? How many types does the Column player have? c) A strategy in a static (simultaneous) Bayesian game describes an action for each that a player could be d) Fill in the blanks in the normal form representation of the Bayesian game defined above LL 0.5, 0.5 Column L R T 0,0 0,0 B 0,0 2, 2 Game 2, Pr(B) = 1/2 0.5, 0.5 Row 1,1 RL RR 0,0 J e) What components define a Bayesian Nash equilibrium in a static game of asymmetric…Во ein g C. 190 d. 210 Inv est Do n't Diagram 1 Air bus Air bus Inv est Do n't Inv est Do n't (-25,-25) (170,0) (0,190) (0,0) Suppose that both Boeing and Airbus receive a subsidy of 20 units to invest. What is Boeing's equilibrium payoff in this game? a. -5 b. 0learn.canterbury.ac.nz Clasarsom Nov 15-ICO EUC LEARN | AKO See the game below and answer the questions 8 to 11: Player-1 C Player-2 X, Y Y Player-1 9 14 8. Player-2 16 17 16 Nash Equilibrium in this game: Select one: O a. Playert: C; Player2: X O b. Playert: C; Player2: Y Oc. Playert: L; Player2: X Od. Playert: L; Player2: Y e. None
- 2. Consider the following Bayesian game with two players. Both players move simultaneously and player 1 can choose either H or L, while player 2's options are G, M, and D. With probability 1/2 the payoffs are given by "Game 1" : GMD H 1,2 1,0 1,3 L 2,4 0,0 0,5 and with probability 1/2 the payoffs are according to "Game 2" : G |M|D H 1,2 1,3 1,0 L 2,4 0,5 0,0 (a) Find the Nash Equilibria when neither player knows which game is actually played. (b) Assume now that player 2 knows which one among the two games is actually being played. Check that the game has a unique Bayesian Nash Equilibrium.Subgames • • • At each node where a player makes a decision, we can think about the "subgame" starting at that node A subgame is the portion of the tree following a particular node How many subgames does our first sequential move example have? • How many subgames does our entry game have? • How many subgames does the game on the right have? • What are its Nash equilibria? Player 1 (1,4) T Player 2 U B (5,2) (3,3) р Player 1 D L 9 (2, 0) Player 2 R (6, 2)1. Consider the following sequential game: Left (3,5) Mary Go (6,4) Up Right John Stop (5.7) John (a) Draw the game tree of the game. John Go Down (4,1) Left Mary Stop (2,5) Right (6,-1) (John as player 1 and Mary as player 2) By backward induction, find a Nash equilibrium and the corresponding payoffs. 2. Eve and Noa start with $10 in each of their piles. They take turns choosing one of two actions, continue or stop, with Eve choosing first. Each time a player says continue, $10 will be removed from her pile, and $20 will be added to the other player's pile. The game automatically stops when the total amount in their piles reaches $60. (Eve as player 1 and Noa as player 2) (b) By backward induction, find a Nash equilibrium and the corresponding payoffs.
- Во ein g Inv est C. 25 d. 200 Do n't Diagram 1 Air bus Air bus Inv est Do n't Inv est (-25,-25) (170,0) (0,190) Do (0,0) n't Suppose that both Boeing and Airbus receive a subsidy of 30 units to invest. What is Boeing's equilibrium payoff in this game? a. 0 b. 520.38 C 1 Search il 4G O Microeconom... 1. In the sequential games such as the sequential Battle of the Sexes, why does the Nash equilibrium allow for outcomes with noncredible threats? 2. Left Right Up 1, 3 3, 1 Down 2, 2 4, 4 a. Find the Nash equilibrium or equilibria b. Which player, if any, has a dominant strategy? c. Does A benefit from changing the game by reducing his or her payoff in this way? 3. Noah and Xaviera love to play "Hide and Seek." It is a simple game, but it continues to amuse. It goes like this. Xaviera hides upstairs or downstairs. Noah can look upstairs or downstairs but not in both places. If he finds Xaviera, Noah gets one scoop of ice cream and Xaviera gets none. If he does not find Xaviera, Xaviera gets one scoop of ice cream and Noah gets none. a. Fill in the payoffs in the matrix below! Is this a zero-sum game? What are the Nash equilibria in pure strategies? Hide and Seek Xaviera Upstairs Downstairs Upstairs Noah Downstairs b. Find a Nash equilibrium in…. In a gambling game, Player A and Player B both have a $1 and a $5 bill. Each player selects one of the bills without the other player knowing the bill selected. Simultaneously they both reveal the bills selected. If the bills do not match, Player A wins Player B's bill. If the bills match, Player B wins Player A's bill. a. Develop the game theory table for this game. The values should be expressed as the gains (or losses) for Player A. b. Is there a pure strategy? Why or why not? c. Determine the optimal strategies and the value of this game. Does the game favor one player over the other? d. Suppose Player B decides to deviate from the optimal strategy and begins playing each bill 50% of the time. What should Player A do to improve Player A’s winnings? Comment on why it is important to follow an optimal game theory strategy.
- In game theory, a dominant strategy is the best strategy to pick, no matter which moves are chosen by the other player. O to make the exact same move that was made by the other player. the choice that causes the payoff for the other player to be minimized, regardless of the payoff it earns the best strategy to pick, assuming the other player makes his or her best possible choice. to allocate all personnel resources towards defensive talent in order to dominate opposing offenses. 46°FGame theory Consider a simultaneous move game with two players. Player 1 has three possible actions (A, B, or C) and Player 2 has two possible actions (D or E.) In the payoff matrix below, each cell contains the payoff for Player 1 followed by the payoff for Player 2. Player 2 7. Player 1 ہے A B C D -3, -3 0, -11 -4, 3 -11, E 0 -7, -7 -12, 0 (a) Identify any dominated strategies in this game. If there are none, state this clearly. (b) Identify any pure strategy Nash Equilibria in this game. If there are none, state this clearly.What is Ann's maximin strategy? Game Bob L RAnn U 10,-1 4, 4 D 4, 1 8, -1 Select one: a.none of the other answers b.4/7 U + 3/7 D c.2/5 U+ 3/5 D d.2/7 U + 5/7 D e.3/5 U + 2/5 D