- 5 5 Question 1 25 Pts Consider The Following Two Person Normal Form Game 1 N A Ui Where N 1 2 A1 1 (80.22 KiB) Viewed 47 times
= == (5,5) Question 1. (25 pts.) Consider the following two person normal form game: 1 = (N, A;, ui) where N = {1,2}, A1 = {U, M1, M2, D, B}, A2 = {L,C1,C2,C3, R}, and wi : A1 x A2 → R for i = 1, 2 are as in the following Player 2 L C C2 C3 R U (6,8) (15,2) (15,2) (11,0) (4,9) Mi (7,1) (12, 10) (12, 12) (10, 10) (5,9) Player 1 M2 (8,3) (4,4) (2,2) (11,7) (4, 12) D (7,4) (6,6) (11,8) (5,5) (6,3) B (5,5) (5,5) (5,5) (5,5) (5,5) a. (6 pts.) Consider the action profile (D, C2) and suppose that A.0 and A.1 hold. Does this action profile pass the best-response test? If so, show it. If not identify the deviator and her strictly profitable deviation opportunity. b. (12 pts.) Identify the pure strategy best responses of each of the players under A.0 and A.1. c. (7 pts.) Identify the pure action profiles that pass the best response test, i.e., find the set of pure strategy Nash equilibrium of this normal-form game. Justify your steps and conclusions. 1