(Demand Game) Two players can divide ten dollars. Find the Nash equilibria of the following two games. (a) The players simultaneously submit demands, numbers in {0, 1,...,10). If the sum of the demands is at most 10, each player gets what she demands. Otherwise both get 0. (b) As in the previous part, except that if the sum of the demands exceeds 10, then (i) if the demands differ then the player who demands less gets her demand and the other player gets the rest, and (ii) if the demands are the same then each player gets 5. (Hint- write the best response functions).

(Demand Game) Two players can divide ten dollars. Find the Nash equilibria of the following two games. (a) The players simultaneously submit demands, numbers in {0, 1,...,10). If the sum of the demands is at most 10, each player gets what she demands. Otherwise both get 0. (b) As in the previous part, except that if the sum of the demands exceeds 10, then (i) if the demands differ then the player who demands less gets her demand and the other player gets the rest, and (ii) if the demands are the same then each player gets 5. (Hint- write the best response functions).

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter8: Game Theory

Section: Chapter Questions

Problem 8.9P

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