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Unformatted text preview: indicating their strategies and payoffs. Find the rollback equilibrium. Write out the complete equilibrium strategy of both players. b. What is your advice to the gas station owner? Why? 2. (3) Rational behavior on the part of economic actors means that a. Actors try to maximize their monetary wealth. b. Actors try to make themselves better off than their competition c. Actors are perfect calculators and flawless followers of their best strategies. d. Actors usually follow their best strategies, but sometimes dont. 3. (3) Is the game that you played in question 1 a zero-sum game? Explain why or why not. 4. (4) Don is deciding whether to invest in a new company. He thinks theres a 20% probability that hell make $10,000, a 30% probability that hell make $5000, a 40% probability that hell make nothing, and a 10% probability that hell lose $30,000. His expected payoff from the investment is:...
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- Spring '06