ECON 398 HOMEWORK 2
Professor Ozdenoren
1.
In the following game between Donna’s and Pierce’s find the equilibrium using
iterated elimination of dominated strategies.
DONNA’S
High
Medium
PIERCE’S
60,
60
High
Medium
Low
Low
70,
36
35,
36
36,
20
50,
30
35,
30
36,
35
30,
25
25,
55
2.
Consider a game in which four players (who can’t communicate with each other)
each have to write either “$2” or “$10.” If at least one player writes “$2,” then each
player receives the amount of money that she wrote. If, however, every player writes
“$10,” then no player gets any money. Determine (and state) how many Nash
equilibria there are in this game (in pure strategies), explain why those sets of actions
are Nash equilibria, and explain why no other set of actions is a (pure strategy) Nash
equilibrium.
3.
Consider the following game between Martin and Andreas.
ANDREAS
L
M
R
U
50,50
60,80
60,70
M
80,60
40,40
80,70
MARTIN
D
70,60
70,80
30,30
a)
Find all the Nash equilibria of this game.
b)