ch 10 notes.docx - Ch 10 Game Theory: Inside Oligopoly...

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Ch 10 Game Theory: Inside Oligopolysimultaneous-move game (Bertrand Game)player make decisions without knowledge of other players’ decisions.sequential-move gameone player makes a move after observing the other player’s move.one-shot gamethe underlying game is played only once.repeated gamethe underlying game is played more than once.Simultaneous, One-short Game:normal-form gametable indicate the players, possible strategies, and payoffs resulting from alternative strategies.dominant strategy: results in the highest payoff to a player regardless of the opponent’s action.secure strategy: a strategy that guarantees the highest payoff given the worst possible scenario.Nash equilibrium:given the strategies of the other player, no player can improve her payoff by unilaterally change her strategy.Game principals:1. Play Your Dominant Strategy2. Put Yourself in Your Rival’s Shoes. If you do not have a dominant strategy, and your rival has a dominant strategy, anticipatethat he or she will play it.

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Term
Spring
Professor
JEFFWARD

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