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Unformatted text preview: Shall I take the offer? Or I can just crush it under my foot… 5 The Game Let’s say the donut is worth $10 Homer proposes an ultimatum: split the donut by offering x to Bart and keeping (10 – x ) Bart responds by… accepting the offer, crushing the donut, or “crushing it partially” Bart chooses some number k between 0 and 1 Payoffs: – Bart gets: k x – Homer gets: k (10 – x ) 6 The Game You will play be assigned a role randomly There are twelve decision rounds Randomly matched in pairs A slight variation: Bart must choose either accept ( k = 1) or reject ( k = 0)...
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This note was uploaded on 04/01/2008 for the course UGBA 143 taught by Professor Xuanmingsu during the Spring '08 term at University of California, Berkeley.
- Spring '08