Unformatted text preview: rounds?) B) Suppose that Player 2 is using a “grim trigger” strategy, where he will cooperate so long as Player 1 cooperates, but if Player 1 ever defects, Player 2 will defect forever. What is the highest expected total payoﬀ that Player 1 could get if he plays defect on the ﬁrst move? Is there a Nash equilibrium in which both players play the grim trigger strategy? Explain your answer. C) Suppose that Player 2 plays a “tit-for-tat” strategy in which he cooperates on the ﬁrst move and in all later periods he uses the same action that Player 1 took on the preceding move. What would be the expected payoﬀ to Player 1 if he played Defect on his ﬁrst move and then played cooperate in all future moves? Is there a Nash equilibrium in which both players play the “tit-for-tat” strategy? Explain your answer. 1...
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This note was uploaded on 12/25/2011 for the course ECON 171 taught by Professor Charness,g during the Fall '08 term at UCSB.
- Fall '08