ps4 - 14.12 Game Theory Muhamet Yildiz Fall 2005 Homework 4...

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14.12 Game Theory Muhamet Yildiz Fall 2005 Homework 4 Due on 11/7/2005 (You may return your homework until 11/9 in class, but your homework will be graded before the midterm only if you submit it by 11/7.) 1. Consider the game in which the following stage game is repeated f ve times: LR A 2,1 0,0 B 0,0 1,2 Assume that the payo f s are the sum of the stage payo f s. For each strategy pro f le in the stage game, f nd a pure-strategy subgame-perfect equilibrium of the repeated game in which the players play the strategy pro f le in the f rst day. 2. Goliath Software is a large software company that sells an internet browser called X. Each year a new startup comes along. The startup can either produce another browser that is comparable to X or a search engine. Seeing what the startup produced, Goliath Software either updates X or not. At the end of that year, independent of the outcome, the start up disappears, leaving its place to the next start up. The annual pro f ts for each contingency are as in the following table, where the f r s ten t ryi sthep ro f to f Goliath Software: Browser Search Engine Update 1,0 3,1 No Update
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This note was uploaded on 11/28/2011 for the course ECONOMICS 114.126 taught by Professor Muhammadyildiz during the Spring '05 term at University of Massachusetts Boston.

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ps4 - 14.12 Game Theory Muhamet Yildiz Fall 2005 Homework 4...

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