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NashNotes - Player A Cooperate 2000 1500 4000 50 Not...

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Step by step guide on how to find a Nash Equilibrium or Equilibria Step 1. Look at the payoff matrix and figure out whose payoff’s are whose: Player B Cooperate Not Cooperate Player A Cooperate 2000 (B) 1500 (A) 4000 (B) 50 (A) Not Cooperate 100 (B) 2000 (A) 101 (B) 60 (A) Step 2. Figure out Player A’s best response to all of player B’s actions Player B Cooperate Not Cooperate Player A Cooperate 2000 1500 4000 50 Not Cooperate 100 2000 101 60 Since 2000 > 1500 and since 60 > 50
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Step 3. Figure out Player B’s best response to all of player A’s actions Player B Cooperate Not Cooperate
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