Principles of Economics (Second Edition)
2nd Edition
ISBN: 9780393614077
Author: coppock, Lee; Mateer, Dirk
Publisher: W. W. Norton & Company
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Chapter 13, Problem 6QFR
To determine
The explanation of Nash equilibrium and its difference from dominant strategy.
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What is the difference, if any, between a dominant strategy and a Nash equilibrium? Give examples.
what is the difference between nash equilibrium and dominated strategy?
What is meant by dominant strategy?
Chapter 13 Solutions
Principles of Economics (Second Edition)
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- why is a nash equilibrium stablearrow_forwardDefine a dominant strategy and Nash equilibrium. Can two firms interacting with each other have no Nash equilibria if both have a dominant strategy?arrow_forwardThe following is a static game: Convert this game into dynamic form game. Find the Nash equilibrium and subgame perfect Nash equilibrium of this game. If you consider this game as dynamic then what kind of dynamic game is this.arrow_forward
- Consider the following extensive form game: Find the Nash equilibrium Find subgame perfect Nash Equilibrium Explain why all Nash equilibriums are not subgame perfectarrow_forwardUse the following normal-form game to answer the following questions. a. For what values of x is strategy D (strictly) dominant for player 2? b. For what values of x is strategy B (strictly) dominant for player 1? c. For what values of x is (B, D) the only Nash equilibrium of the game?arrow_forwardExplain the meaning of a Nash Equilibrium. How does it differ from and equilibrium in dominant strategies?arrow_forward
- Imagine a small town with three car repair shops competing for a limited number of customers. Explain why the three shops working together to keep their prices high is unlikely to be a Nash equilibrium.arrow_forwardFind all the Nash equilibria (in the strategic form) and the subgame perfect nash equilibria in the following game. Are they the same ?arrow_forwardFind any Nash equilibria in the game below. Firm B Co-operate Don’t co-operate Firm A Co-operate 60 60 0 80 Don’t co-operate 80 0 10 10 Answer a. There is one Nash equilibrium: both firms don't co-operate. b. There are no Nash equilibria. c. There are two Nash equilibria: one firm co-operates and the other firm doesn't co-operate. d. There are two Nash equilibria: (i) both firms co-operate and (ii) both firms don't co-operate.arrow_forward
- how do you describe the pure Nash equilibrium of a game, listing all equilibrium conditions.arrow_forwardYou have just played rock, paper, scissors with your friend. You chose scissors and he chose paper, so you won. Is this a Nash equilibrium? Explain why or why not.arrow_forwardWhat is the difference between Dominant strategy and mixed strategy? Please explainarrow_forward
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