2/5/2009
Midterm 1: Next Tuesday
Covers up through Chpt. 5 & HW 3 Bring a UMID for check-in No cellphones or i-pods allowed Calculators must be simple non-graphing simple, non-graphing, non-complex,
2/5/2009
A Note About Equilibria
Some games
Get feel for what an equilibrium might be Show that if everyone does it, nobody has an incentive to change Show everything else isnt equilibrium: for each
11 Chapter model
10/18/2013
10/26/15 11:34 PM
Chapter 11. The Basics of Capital Budgeting
We used this model to create most of the chapter exhibits (Tables and Figures). We pasted in
a few dialog boxe
Econ 398 Homework 2
Sketchy Solutions 1. There are four Nash Equilibria; each one involves one of the four writing down $3, while the other three each write down $10. Notice that in a strategy profile
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06 Chapter Model
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10/18/13
Chapter 6. Interest Rates
THE DETERMINANTS OF INTEREST RATES (Section 6-3)
Interest rates can easily be observed. All it requires is reading
12 Chapter model
10/18/2013
10/26/2015 23:33
Chapter 12. Cash Flow Estimation and Risk Analysis
This worksheet contains a model to analyze Allied's new expansion project, Project S. Models for analyzi
Solutions to Chapter 13 Exercises SOLVED EXERCISES
S1. (a) The payoff table for the two types of travelers is: High High Low 100, 100 70, 30 Low 30, 70 50, 50
(b)
The graph is:
(c)
There are three pos
Solutions to Chapter 14 Exercises SOLVED EXERCISES
S1. Some examples of incentive schemes that help induce more care on the part of policy holders: 1. The insurer can provide a multiyear contract or o
Solutions to Chapter 15 Exercises SOLVED EXERCISES
S1. (a) In the pure-threat case, the unions expected payoff is 50(1 p) 100p = 50 150p. The
unions expected payoff goes to zero for p = 1/3 and is neg
Solutions to Chapter 16 Exercises SOLVED EXERCISES
S1. Under truthful voting, A should match Geology and Sociology in the first vote, with the winner (Geology) to face Philosophy in the second round.
Solutions to Chapter 17 Exercises SOLVED EXERCISES
S1. The painter can compare her estimated cost to a jobs true cost only when she does the job. But
the painter does a job only when she agrees (throu
Solutions to Chapter 18 Exercises SOLVED EXERCISES
S1. The father and daughter were implicitly negotiating about how much freedom from parental
control she would have. The fathers BATNA was low: break
Solutions to Chapter 19 Exercises SOLVED EXERCISES
S1. (a) The existence of buyer B2 means that buyer B1 will not be able to buy at any price below
200. If B1 tried to strike a deal at (for example) 1
Solutions to Chapter 2 Exercises SOLVED EXERCISES
S1. (a) Assuming a sufficient supply of yogurt is available for all shoppers, each shopper is
simply making a decision. If some flavors of yogurt were
Solutions to Chapter 3 Exercises SOLVED EXERCISES
S1. (a) There is one initial node (I) for Hansel making the first move; three decision nodes (D)
including the initial node, which represent the point
9/10/2008
Analyzing Games
We need three things to specify a game
Players Possible strategies for each player Payoffs for eac p aye o e ou co es ayo s o each player over outcomes
Analyzing Games
Player
Solutions to Chapter 12 Exercises SOLVED EXERCISES
S1. (a) (b) The number choosing X should decrease to move the population division between X and Because the line for action X is above the line for a
Solutions to Chapter 11 Exercises SOLVED EXERCISES
S1. False. The players are not assured that they will reach the cooperative outcome. Rollback
reasoning shows that the subgame-perfect equilibrium of
10/29/2008
Expert Advice
We often rely on professionals to diagnose problems and recommend and carry out fixes
Doctors Auto Mechanics and Repair Technicians p Lawyers Financial Advisors and Real Estat
10/16/2008
Mixed Strategies Matching Pennies
We denote the strategies on the game bi-matrix
Guildenstern q Heads Rosencrantz R t p 1-p Heads H d Tails 1 , -1 1 -1 , 1 1-q Tails -1 , 1 1 1 , -1
Mixed S
10/30/2008
Midterm 2: Next Tuesday
Exam focuses on new material
Chapter 5 to beginning of Chapter 9 Lectures 8-16, HW 4-6
Signaling with Strategic Uncertainty
Otto Stag Ludwig Stag Hare 2,2 1,0 Hare 0
11/10/2008
Spence: Education as a Screen
Education does not affect productivity Two types of people
Able types worth $150,000 Challenged types worth $100,000 $100 000 Types are indistinguishable, can'
11/13/2008
Strategic Moves
Change the rules of the game to benefit yourself Usually involves making a pre-game move 1st Actions must be
Observable Irreversible
Strategic Moves
Strategic moves are to d
11/20/2008
The Entry Game
(-200,-100)
Fight
Burning Money
I E Challenger F A (-200, -100) (100, 100)
INCUMBENT SO Don t Don't Invest
Acquiesce
(0, (0 300)
(100,100) Incumbent I Invest E A Challenger (
12/2/2008
Collective Action Problems
Often, the welfare of society is best served if individuals take a particular "socially responsible" action. On the other hand, individuals may not find it in thei
12/2/2008
Collective Action Games
N = population n = # of participants who take an action N-n = # of shirkers who do not take the action Participant g p gets: p( ) p(n) Shirker gets: s(n)
Collective A