Unformatted text preview: 2. What are the two bundles oﬀered and their corresponding fees? (d) Using isoproﬁt and indiﬀerence curves, graph your answers to (a) and (c). 2. Consider the two player game below where a ≤ 2 L C R T 3 , 1 a, 0 7 ,1 1 M a, 2 , 5 7 , 1 B a1 , 7 1 , 7 6 , 6 (a) Find all pure strategy Nash equilibria (b) Suppose a = 0. Find a mixed strategy equilibrium. Now suppose a =1. Again ﬁnd a mixed strategy equilibrium. What is the intuition for how a changes the mixed strategy equilibrium? (c) Suppose now 1 gets to move ﬁrst. Draw the extensive form game. Find all subgame perfect Nash equilibria and one Nash equilibrium that is not subgame perfect. 1...
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This note was uploaded on 05/13/2010 for the course ECON 105D taught by Professor Cur during the Fall '09 term at Duke.
 Fall '09
 CUR
 Microeconomics

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