Question
A prospective employee (Player 1) is talking with an employer (Player 2) who says, Lets have lunch. There are two restaurants where they could meet,
A prospective employee (Player 1) is talking with an employer (Player 2) who says, Lets have lunch. There are two restaurants where they could meet, A and B. Player 1 would prefer Restaurant A as it is cheaper. Player 2 would prefer restaurant B as the food is better. Player 1 really wants to meet Player 2. Player 2s preferences are unknown to Player 1 (but of course known to Player 2). Player 1 estimates that Player 2 wants to meet with probability . The payoff matrices are:
Player 2 wants to meet:
P1 \ P2 | A | B |
A | 3,2 | 1,1 |
B | 0,0 | 2,3 |
Player 2 does not want to meet:
P1 \ P2 | A | B |
A | 3,0 | 1,3 |
B | 0,2 | 2,1 |
Assuming the assumptions are present to justify a Bayesian game, determine the pure strategy Bayes-Nash equilibria and the range of values for each.
Determine a mixed strategy equilibrium for this scenario.
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