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December 4, 2016

Homework Help: MACROeconomics - Game Theory

Posted by Anonymous on Tuesday, November 24, 2009 at 2:14pm.

I don’t get anything from below except for (c). Please help me! Thanks.

Consider the following game matrix:


....................................................Player B............
............................................Left............Right.......
Player A.........Top..............(a, b)...........(c, d).......
.......................Bottom........(e, f)............(g, h).......

a) If (top, left) is a dominant strategy equilibrium, then we know that “a” is greater than ____, “b” is greater than _____, “c” is greater than _______ and “f” is greater than _______.
a > c , b > e , c > f , f > c

b) If (top, left) is a Nash equilibrium, then which of the inequalities from your answer in part (a) must be satisfied?
a > b and b > f

c) If (top, left) is a dominant strategy equilibrium, must it be a Nash equilibrium?
No

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