Question
Consider the following strategic game played by players 1 and 2. Player 2 can be of 2 types: the friendly type (with probability p),
Consider the following strategic game played by players 1 and 2. Player 2 can be of 2 types: the "friendly" type (with probability p), and the "unfriendly" type (with probability 1 p). When player 2 is friendly, the payoff matrix is: Player 1 Player 2 A B Player 1 a 7,8 2,6 b 6,2 4,3 When player 2 is unfriendly, the payoff matrix is: Player 2 A B a 6,1 1,4 5,6 4,5 b Compute one pure strategy Bayes-Nash equilibrium and give conditions under which it exists.
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Microeconomics An Intuitive Approach with Calculus
Authors: Thomas Nechyba
1st edition
538453257, 978-0538453257
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