Econ 106G Spring 2015
Solution to Homework 2: Applications of Nash Equilibrium
1. Protecting LAZ: LAZ airport has a domestic and a international terminal but only one security team
(player 1) that can cover only one of the terminals. A terrorist organizat
Econ 106G Spring 2015
Homework 1: Dominated Stratgies, Best Responses
The due date for this homework is Monday April 13th in class.
1. Game Theory Concepts, True-False: For each of the following statements, state
whether it is true or false. If it is fals
Econ 106G Spring 2015
Homework 2: Applications of Nash Equilibrium
The due date for this assignment is Monday April 27th in class.
1. Protecting LAZ: LAZ airport has a domestic and a international terminal but only one security team
(player 1) that can co
Econ 106G Spring 2015
Solution to Homework 1: Dominated Stratgies, Best Responses
1. True-False:
(a) False. Cooperate is not a best response to any beliefs in the prisonersdilemma.
(b) True.
(c) False. In the beauty contest, all strategies si 2 f68; : : :
Econ 106G Spring 2015
Practice Problems 2 - Solution: Normal Form Games Application
1. Policy Setting with the Mean Rule: An odd number n of players have to set a
common policy, i.e. a number x 2 [0; 10]. Each player has a favorite policy xi . They
vote o
Arbitrage
Professor Pierre-Olivier Weill
1
Last time
Measuring interest rate sensitivity:
Duration
Application of duration:
Immunization
Convexity
Pension fund example
2
Outline
Arbitrage definitions
Arbitrage pricing
Arbitrage pricing with trans
For the exclusive use of C. Hurley, 2014.
CASE: SM-176
DATE: 07/28/09
GOOGLES ANDROID: WILL IT SHAKE UP THE WIRELESS
INDUSTRY IN 2009 AND BEYOND?
We want people out there to use the Internet on their phones a lot. It actually doesnt matter if it
is Androi
Econ 106G Spring 2015
Solution to Assignment 3: Extensive Form Games
The due date for this assignment is Monday May 18th.
1. Game Theory Concepts, True or False: Answer if the following statements are
true or false. If they are false, give an example that
Dr. Randall R. Rojas
Economics 106V
Department of Economics
Investments
UCLA
Fall, 2014
Midterm Exam
November 13, 2014
First Name
Last Name
UCLA ID #
TA/Section
Please do not start the exam until instructed to do so.
Part I: Short Answers
For full credit
Lecture 9 - Extensive Form Games and Backward Induction
Watson - 14-15
Econ 106G Spring, 2015
Extensive Form Games and Game Trees
In many situations, players move sequentially, for example,
real games: chess, checkers, poker, go, nim,
in sports: chess, go
Lecture 11 - Bargaining
Watson 19
Econ 106G Spring 2015
In many economic scenarios, parties argue over how to divide some surplus, e.g. rm and
workers, partners in a partnership, interest groups in a country, etc.
Ultimatum Game
First consider an easy bar
Lecture 10 - Commitment
Watson 15-16
Econ 106G Spring 2015
Commitment
War Game - Chicken
Consider the interaction between two armies. Each army can either F ight or Retreat. Each
army prefers to ght if the other retreats but prefers to retreat if the othe
Lecture 14 - Cooperation through Innitely Repeated Interaction
Watson: 22
Econ 106G Spring 2015
Innitely Repeated PrisonersDilemma
Consider the Repeated PrisonersDilemma
2
C
1 C 1,
D 2,
1
1
D
1, 2
0, 0
Suppose that the stage game is repeated innitely ofte
Lecture 8 - Applications of Mixed Strategies
Watson - 11
Econ 106G Spring 2015
Expert Diagnosis
Consider a situation where a customer has a problem and relies on the advice of an expert
who selling her advice, e.g. a car mechanic, a dentist, or an investm
Econ 106V Homework 6 Solution
Chapter 20: Problem 9
a. i. A long straddle produces gains if prices move up or down and limited losses
if prices do not move. A short straddle produces significant losses if prices
move significantly up or do
Econ 106VL
Statistical and Probability Review
Professor Pierre-Olivier Weill
Linlin Ye
1
Outline
Practical information about the class
Random variables, probability distributions
Introduce todays lab assignment
2
Class times and venues Section 1
- Lec
Statistics Review
Prof. Stijn Van Nieuwerburgh and Prof. Pierre-Olivier Weill
September 26, 2010
1
Introduction
Please study this handout carefully. It will be instrumental for your understanding of portfolio
theory. In nance we think of a stock return as
Problem Set 7
Investments
Prof. Pierre-Olivier Weill
Find investment strategies using Microsoft puts, calls and/or underlying stock, which best
express the investors objectives described below. Construct the prot diagrams and tables,
in $10 increments, if
Market Eciency
and Anomalies
Professor Pierre-Olivier Weill
1
Last 1me
Black and Scholes
Prices of calls and puts as a func1on of:
Price of the stock
Vola1lity
Strike price
Expira1on date
Implied
Options and Derivatives
Professor Pierre-Olivier Weill
1
Last time
Binomial option pricing
Applies to the pricing of all derivatives!
2
Today:
Black-Scholes-Merton Formula
Assumptions
The formula
Intuition
Implied volatility
Hedge ratio
Put option
Lecture 13 - Cooperation through Repeated Interaction
Watson: 22
Econ 106G Spring 2015
The dilemma of the prisonershas it roots in the divergence of individual interests, to play
Def ect, and the social interests, to both play Cooperate. The stark predict
Lecture 12 - Sub-Game Perfect Equilibrium
Watson: 15-16
Econ 106G Spring 2015
Entry into an Monopolistic Market
When we considered the entry game earlier we modeled the competition after entry by a
single decision of the incumbent, to ght - yielding negat
Lecture 6 - Nash Equilibria: Cournot & Bertrand Competition
Watson - 10
Econ 106G Spring 2015
If rms are small compared to the market we usually assume that they take prices as
given. Thus when they decide on the quantities they produce or whether to ente
For the exclusive use of C. Hurley
SARIT MARKOVICH AND EVAN MEAGHER 09
KEL792
Hip to be Square:
Disruption in the U.S. Mobile Payment Market
Founded in San Francisco in 2009, Square finished 2012 as the darling of Silicon Valley;
flush with more than $340
Econ 106G Spring 2015
Answers to Practice Problems 1: Basic Concepts, Dominated
Strategies
1
Basic Concepts
Sex-ratio Prisoners Dilemma and Run or Pass are games of complete
,
information. In Crying it out the father has incomplete information about
the m
Econ 106G Spring 2015
Practice Problems 2: Normal Form Games Applications
You do not need to submit answers to these problems. I still encourage you to
think them through thoroughly, and write down your answers.
1. Policy Setting with the Mean Rule: 3 pla
Econ 106G Spring 2015
Practice Problems 1: Basic Concepts, Dominated Stratgies
You do not need to submit answers to these problems. I still encourage you to
think them through thoroughly, write down your answers and discuss them with
your classmates.
1. B
Econ 106G Spring 2015
Solutions to Practice Problems 3: Applications of Normal Form Games
1. Game Theory Concepts, True or False: Answer if the following statements are
true or false. If they are false, give an example that contradicts the statement
(a) E
Econ 106G Spring 2015
Practice Problems 3: Applications of Normal Form Games
You do not need to submit answers to these problems. I still encourage you to think
them through thoroughly and write down your answers before looking at the solutions.
1. Game T