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Unformatted text preview: U high quality low quality buy 6,10 u 2,4 dont buy 0,2 0,0 (buyers payoff, sellers payoff) Game B: Buyer u Seller U high quality low quality buy 6,4 u 2,10 dont buy 0,0 0,2 (buyers payoff, sellers payoff) a . Are there any dominant strategies for the seller and/or the buyer in game A? Are there any in game B? If yes, identify them. What is the Nash equilibrium of game A, what is the Nash equilibrium of game B? b . Now suppose that the Buyer does not know whether she is playing Game A or Game B. Her beliefs are that she plays Game A with probability and Game B with probability . Draw the game tree. c . Derive the Bayesian Nash equilibrium of the incomplete-information game. 3 . Derive the (mixed-strategy) Nash equilibrium of the following extensive-form game between player 1 and player 2: Player 1 u Player 2 U A B C A 0, 1 1, 0 1, 0 B 2, 0 0, 2 2, 0 C 3, 0 3, 0 0, 3 4 . Jehle/Reny, exercises 7.16 and 7.17....
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This note was uploaded on 02/18/2010 for the course ECON 329 taught by Professor Hazz during the Spring '10 term at UT Arlington.
- Spring '10
- Game Theory