This preview shows pages 1–2. Sign up to view the full content.
14.12 Game Theory
Prof. Muhamet Yildiz
Fall 2010
Homework 2
Due on 10/12/2010 (in class)
Youneedtoshowyourworkina
l
lquest
ions
.
1. Consider the following game:
LM
N
R
A
(3
2)
(0
0)
(6
0)
(0
0)
B
(0
0)
(2
4)
(1
2)
(0
0)
C
(1
4)
(1
3)
(0
5)
(
−
1
0)
D
(0
0)
(0
0)
(0
−
1)
(0
0)
(a) Compute the set of rationalizable strategies.
(b) Find all Nash equilibria (including those in mixed strategies).
2. Solve the following game using backward induction:
3. Two telecommunication companies, namely AmonRa and Bob’s, are competing in an
auction to buy the right to use a particular frequency in Massachusetts. AmonRa is
a new company while Bob’s is an incumbent company and uses the same frequency
in Connecticut already, which makes the frequency in MA more valuable. The value
of the frequency is
for AmonRa and
for Bob’s. In the auction, the
This preview has intentionally blurred sections. Sign up to view the full version.
View Full Document
This is the end of the preview. Sign up
to
access the rest of the document.
 Spring '11
 LieWang

Click to edit the document details