problem set3 solution

Hint to do this first assume that the outcomes

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Unformatted text preview: his, first assume that the outcomes generate utilities . Then compute the expected utilities of the three lotteries above, and derive a contradiction between the inequalities corresponding to Jill’s preferences.] Let denote the utility Jill gets from , respectively. If ( ) is an expected utility representation of Jill’s preference then the expected utility for the three lotteries are () () () With , we must have () () () ( ) means By definition, ( ) () () su tract on oth sides divide on oth sides () () y definition ( ). Therefore, it is impossible to assign which contradicts the condition ( ) utility numbers to the outcomes so that the ranking of the expected utilities of the three lotteries matches Jill’s preference ranking 3. For each of the following games, answer the following questions: i) Find all Pareto efficient outcomes. (Do not assume transferable utility.) ii) Is the game dominance solvable? If so, find the solution. iii) Find all pure-strategy Nash equilibria, if they exist. Game a...
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This homework help was uploaded on 03/17/2014 for the course ECON 302 taught by Professor Shihenlu during the Fall '13 term at Simon Fraser.

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