slides7 - Lecture 7 Mixed-Strategy Nash Equilibrium 14.12...

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Lecture 7 Mixed-Strategy Nash Equilibrium 14.12 Game Theory Muhamet Yildiz Road Map 1. Some 2x2 games 2. Mixed-strategy Nash Equilibrium 3. Quiz 4. Applications and examples: 1. Price competition with costly search 2. Dove-Hawk 3. Matching Penny 1
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Hawk-Dove game c V c V 2 , ( V ,0) 2 (0, V ) ( V /2, V /2) Last week’s Quiz Question Without talking to anyone, each student is to write either INVEST or CONSUME on a piece of paper. TAs will randomly match students. Your grade: You Your Partner INVEST CONSUME INVEST 100 0 CONSUME 60 60 2 Figures by MIT OCW.
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Stag Hunt (3,3) (0,2) (2,0) (2,2) Equilibrium in Mixed Strategies What is a strategy? – A complete contingent-plan of a player. – What the others think the player might do under various contingency. What do we mean by a mixed strategy? – The player is randomly choosing his pure strategies. – The other players are not certain about what he will do. 3 Figures by MIT OCW.
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slides7 - Lecture 7 Mixed-Strategy Nash Equilibrium 14.12...

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