Principles of Microeconomics (MindTap Course List)
8th Edition
ISBN: 9781305971493
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 17, Problem 8PA
Subpart (a):
To determine
Payoff matrix.
Subpart (b):
To determine
Payoff matrix.
Subpart (c):
To determine
Payoff matrix.
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Two athletes of equal ability are competing for a prize of $10,000. Each is deciding whether to take a dangerous performance enhancing drug. If one athlete takes the drug, and the other does not, the one who takes the drug wins the prize. If both or neither take the drug, they tie and split the prize. Taking the drug imposes health risks that are equivalent to a loss of X dollars.
a) Draw a 2×2 payoff matrix describing the decisions the athletes face.
b) For what X is taking the drug the Nash equilibrium?
c) Does making the drug safer (that is, lowering X) make the athletes better or worse off? Explain.
Two athletes of equal ability are competing for a prize of $12,000. Each is deciding whether to take a dangerous performance-enhancing drug. If one athlete takes the drug and the other does not, the one who takes the drug wins the prize. If both or neither take the drug, they tie and split the prize. Taking the drug imposes health risks that are equivalent to a loss of XX dollars.
Complete the following payoff matrix describing the decisions the athletes face. Enter Player One's payoff on the left in each situation, Player Two's on the right.
Player Two's Decision
Take Drug
Don't Take Drug
Player One's Decision
Take Drug
,
,
Don't Take Drug
,
,
True or False: The Nash equilibrium is taking the drug if X is greater than $6,000.
True
False
Suppose there was a way to make the drug safer (that is, have lower XX).
Which of the following statements are true about the effects of making the drug safer? Check all that…
GAME ZZZ
B1
Player B
A1 30, 30
Player A A2 20, 40
B2
40, 20
35, 35
In the Game ZZZ (see table above), all payoffs are listed with the row
player's payoffs first and the column player's payoffs second. In this
game,
neither player has a dominant strategy.
the Nash equilibrium does not maximize the total payoff.
there is no Nash equilibrium.
the Nash equilibrium maximizes the total payoff.
Chapter 17 Solutions
Principles of Microeconomics (MindTap Course List)
Ch. 17.1 - Prob. 1QQCh. 17.2 - Prob. 2QQCh. 17.3 - Prob. 3QQCh. 17 - Prob. 1CQQCh. 17 - Prob. 2CQQCh. 17 - Prob. 3CQQCh. 17 - Prob. 4CQQCh. 17 - Prob. 5CQQCh. 17 - Prob. 6CQQCh. 17 - Prob. 1QR
Ch. 17 - Prob. 2QRCh. 17 - Prob. 3QRCh. 17 - Prob. 4QRCh. 17 - Prob. 5QRCh. 17 - Prob. 6QRCh. 17 - Prob. 7QRCh. 17 - Prob. 1PACh. 17 - Prob. 2PACh. 17 - Prob. 3PACh. 17 - Prob. 4PACh. 17 - Prob. 5PACh. 17 - Prob. 6PACh. 17 - A case study in the chapter describes a phone...Ch. 17 - Prob. 8PACh. 17 - Prob. 9PA
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