5. Solving for dominant strategles and the Nash equilibrlum As Aa Suppose Jim an

Question

5. Solving for dominant strategles and the Nash equilibrlum As Aa Suppose Jim and Susan are playing a game in which both must simultaneously choose the strategy Heads or Talils. The payoff matrix that follows shows the payoff each person will eam as a function of both of their choices (rather than the actual flipping of a coln).For example, the lower-right cell shows that If 1im chooses Talls and Susan chooses Tals, 3im will receive a payoff of 5 and Susan will recelve a payoff of 1. Susan Heads 3, 4 2, 3 Talls 4, 2 5, 1 Heads Jim Talls The only dominant strategy in this game is for o choose The unique Nash equilibrium in this game is as follows: Jim chooses and Susan chooses

Explanation / Answer

The only dominant strategy is for susan to choose Heads

The unique nash equilibrium of the game is when Jim chooses head and Susan also choses Head

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