I. players II. strategies III. payoffs IV. a pure-strategy Nash equilibrium I. A
ID: 1100068 • Letter: I
Question
I.
players
II.
strategies
III.
payoffs
IV.
a pure-strategy Nash equilibrium
I.
A Nash equilibrium requires that each player have a dominant strategy.
II.
A Nash equilibrium requires that each player have a dominated strategy.
III.
A game can have more than one Nash equilibrium.
I.
Neither firm has incentive to change its advertising strategy, given the strategy choice of its rival.
II.
If Townie Soda decided to stop advertising, its profits would fall below $80,000.
III.
If both firms stopped advertising, it is possible that each firm could earn profits greater than $80,000.
5. In this game, called Matching Pennies, Player 1 wins if both players play the same side of a penny, and Player 2 wins if the players play opposite sides of a penny. Which of the following statements is true? A. (H, H) and (T, T) are Nash equilibria. B. (H, T) and (T, H) are Nash equilibria. C. Both players using each of their strategies with probability 0.5 is a Nash equilibrium. D. There is no Nash equilibrium in either pure strategies or mixed strategies.
Explanation / Answer
Both players using each of their strategies with probability 0.5 is a Nash equilibrium.
B. (0.5, 0.5); (0.9, 0.1)
If a game has only one Nash equilibrium, it can always be found by eliminating dominant strategies.
A. (RS, RS)
C. (C, NC)
]involves at least one participant playing a random strategy after first observing her opponent's strategies.
a pure-strategy Nash equilibrium
B. I, II, and III
II.
A Nash equilibrium requires that each player have a dominated strategy.
C. I and III
f both firms stopped advertising, it is possible that each firm could earn profits greater than $80,000.
II and III