Consider the game in strategic form defined by the following payoff functions: U1(t1,t2) = [10 + w]tįt2 - tỉ, U2(tı,t2) = [10 + w]t,t2 - t. %3D Set the parameter w equal to 1 (a) This game has a unique (pure strategy) Nash equilibrium (t¡, t;) in which t¡ = t;. Find the value of t;. (If your answer is a fraction, report it in lowest terms.) (b) To which strategy tą is the strategy ti = 4 a best response? (If your answer is a fraction, report it in lowest terms.)

Consider the game in strategic form defined by the following payoff functions: U1(t1,t2) = [10 + w]tįt2 - tỉ, U2(tı,t2) = [10 + w]t,t2 - t. %3D Set the parameter w equal to 1 (a) This game has a unique (pure strategy) Nash equilibrium (t¡, t;) in which t¡ = t;. Find the value of t;. (If your answer is a fraction, report it in lowest terms.) (b) To which strategy tą is the strategy ti = 4 a best response? (If your answer is a fraction, report it in lowest terms.)

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter8: Game Theory

Section: Chapter Questions

Problem 8.1P

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