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    Use the following payoff matrix for a simultaneous-move one-

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    Use the following payoff matrix for a simultaneous-move one-shot game to answer the accompanying questions.
    Player 2
    Strategy C D E F
    Player 1 A 25, 15 4, 20 16, 14 28, 12
    B 10, 10 5, 15 8, 6 18, 13
    a. What is player 1's optimal strategy? Why?
    b. Determine player 1's equilibrium payoff.

    Consider a two-player, sequential-move game where each player can choose to play right or left. Player 1 moves first. Player 2 observes player 1's actual move and then decides to move right or left. If player 1 moves right, player 1 receives $0 and player 2 receives $15. If both players move left, player 1 receives - $10 and player 2 receives $8. If player 1 moves left and player 2 moves right, player 1 receives 10 and player 2 receives $10.
    a. Write the above game in extensive form.
    b. Find the ash equilibrium outcomes to this game.
    c. Which of the equilibrium outcomes is most reasonable? Explain.

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    Solution Preview

    Use the following payoff matrix for a simultaneous-move one-shot game to answer the accompanying questions.
    Player 2
    Strategy C D E F
    Player 1 A 25, 15 4, 20 16, 14 28, 12
    B 10, 10 5, 15 8, 6 18, 13
    a. What is player 1's optimal strategy? ...

    Solution Summary

    Use the following payoff matrix for a simultaneous-move one-shot game to answer the accompanying questions.
    Player 2
    Strategy C D E F
    Player 1 A 25, 15 4, 20 16, 14 28, 12
    B 10, 10 5, 15 8, 6 18, 13
    a. What is player 1's optimal strategy? Why?
    b. Determine player 1's equilibrium payoff.

    Consider a two-player, sequential-move game where each player can choose to play right or left. Player 1 moves first. Player 2 observes player 1's actual move and then decides to move right or left. If player 1 moves right, player 1 receives $0 and player 2 receives $15. If both players move left, player 1 receives - $10 and player 2 receives $8. If player 1 moves left and player 2 moves right, player 1 receives 10 and player 2 receives $10.
    a. Write the above game in extensive form.
    b. Find the ash equilibrium outcomes to this game.
    c. Which of the equilibrium outcomes is most reasonable? Explain.

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