3. Consider a state space S {$1, S2, S3, S4, S5}. There are two agents, i...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
3. Consider a state space S {$1, S2, S3, S4, S5}. There are two agents, i = 1,2, with a common prior p = (0.3, 0.1,0.2, 0.3, 0.1). Agent 1 has information partition II₁ = {{$₁, $2}, {$3}, {$4, $5}} and 2 has information partition II2 = {{$3, $2}, {$4}, {81, 85}}. = (a) Given common prior p and information structures II₁, I2, derive types t₁(s), t₂(s), for each s € S. (b) Given the types t₁ and to that you have derived in the previous question, find probability distribution p₁ € AS that is a prior for agent 1 and P2 EAS that is a prior for agent 2, where P1, P2P. Is there a common prior, different from P, that assigns positive probability to all states? (c) Suppose that 1's prior is p₁ = (0.2, 0.1, 0.3, 0.2,0.2) and 2's prior is p2 (0.3, 0.1, 0.2, 0.2, 0.2). Find an ex ante bet and an interim bet. = 3. Consider a state space S {$1, S2, S3, S4, S5}. There are two agents, i = 1,2, with a common prior p = (0.3, 0.1,0.2, 0.3, 0.1). Agent 1 has information partition II₁ = {{$₁, $2}, {$3}, {$4, $5}} and 2 has information partition II2 = {{$3, $2}, {$4}, {81, 85}}. = (a) Given common prior p and information structures II₁, I2, derive types t₁(s), t₂(s), for each s € S. (b) Given the types t₁ and to that you have derived in the previous question, find probability distribution p₁ € AS that is a prior for agent 1 and P2 EAS that is a prior for agent 2, where P1, P2P. Is there a common prior, different from P, that assigns positive probability to all states? (c) Suppose that 1's prior is p₁ = (0.2, 0.1, 0.3, 0.2,0.2) and 2's prior is p2 (0.3, 0.1, 0.2, 0.2, 0.2). Find an ex ante bet and an interim bet. =
Expert Answer:
Answer rating: 100% (QA)
To solve this problem we need to follow these steps a Derive types t1s and t2s for each s S given the common prior p and the information partitions II... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
Students also viewed these economics questions
-
Cookie King Inc. operates a chain of cookie stores. Budgeted and actual operating data for its three Vancouver stores for August are as follows: (Click the icon to view the budgeted contribution...
-
answer the question clearly You are building a flight-control system for which a convincing safety case must be made. Would you assign the tasks of safety requirements engineering, test case...
-
Let A, B be sets. Define: (a) the Cartesian product (A B) (b) the set of relations R between A and B (c) the identity relation A on the set A [3 marks] Suppose S, T are relations between A and B, and...
-
If f (x, y, z) = 2xyz - 1 + x2z3, find the following. (a) f/x (b) f/y (c) f/z
-
Adapt the information in Figure 12.4 to a brief electronic slide show. Your boss might want to see maps of the four locations listed, so have slides with maps ready. (Because you don't have the...
-
Display a list of all data contained in the BOOKS table.
-
What is mathematical modeling, and how is it used in the world of medicine with pandemics?
-
You are the sole contributor to a philanthropic foundation. You must specify whether investment gains should be expendable or nonexpendable. Present the key arguments in favor and against permitting...
-
The most recent comparative balance sheet of Giacomelli Corporation appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current assets: Cash and cash equivalents $ 3 7 ,...
-
New Endor Airlines Database New Endor Airlines (NEA) is the premier aviation service in the small island nation of New Endor, located in the southwestern Pacific Ocean. For the 40 years since its...
-
Big Cheese follows IFRS and offers a defined benefit pension plan to its employees. Pertinent details for the year ended December 31, 2028, are as follows: Current service cost, end of year $60,0...
-
What is the present value of a cash flow stream of $1,200 per year annually for 16 years that then grows at 3.2 percent per year forever when the discount rate is 14 percent?
-
Cedric Company recently traded in an older model of equipment for a new model. The old model's book value was $389,000 (original cost of $799,000 less $410,000 in accumulated depreciation) and its...
-
Two hemispherical shells of negligible mass and radius R = 1.2 m are put together along their horizontal rim, then the (now complete) sphere is submerged in water. The lower hemisphere is tied to the...
-
Define the null and alternative hypothesis in mathematical terms and in words. Report the level of significance. Include the test statistic and the P-value. See Step 2 in the Python script. Provide...
-
We are investing $ 1 5 , 0 0 0 at an interest rate of 6 % , compounded annually for a period of 1 2 years. We want to calculate the future value of this investment. Present Value of $ 1 : i = 6 % , n...
-
Required information [The following information applies to the questions displayed below.] Ravenna Company is a merchandiser that uses the indirect method to prepare the operating activities section...
-
2.) Find the Laplace transform of f(t) 7e-St cos 2t +9 sinh2 2t. Use Laplace Table. %3D
-
In the 2012 tax year, Michelle paid the following amounts relating to her 2010 tax return: Tax deficiency..........................................$5,000 Negligence...
-
Indicate whether each of the items listed below would be included (I) in or excluded (E) from gross income for the 2012 tax year. ________a. Welfare payments ________b. Commissions ________c. Hobby...
-
Clarita is a single taxpayer with two dependent children, ages 10 and 12. Clarita pays $3,000 in qualified child care expenses during the year. If her adjusted gross income (all from wages) for the...
-
Three spanning trees of Graph \(K\), which include edges \(m n\) and \(o q\), but do not include no. Use the figure shown to draw three possible spanning trees that fit the given description. b C d e...
-
Graph 18 Use Kruskal's Algorithm to find a minimum spanning tree of the given graph. Graph it and calculate its weight. 9.3 a 1.5 13.3 5.2 8.7 Graph 17 2.0 50' 100 110 250 300 90 75 225 210 425 Graph...
-
The Prepaid Insurance account began the year with a balance of $460. During the year, insurance in the amount of $1,040 was purchased. At the end of the year (December 31), the amount of insurance...
Study smarter with the SolutionInn App