Question
JERRY Cooperate Defect TOM Cooperate 15, 15 -10, 25 Defect 25, -10 7, 7 Consider the above game played between Tom and Jerry. (a). If
JERRY | ||||
Cooperate | Defect | |||
TOM | Cooperate | 15, 15 | -10, 25 | |
Defect | 25, -10 | 7, 7 | ||
|
Consider the above game played between Tom and Jerry.
(a). If the above game were played 15 times in a row, can you determine what would happen using rollback analysis? What strategies will be played by each player?
(b). Now suppose that the game is played indefinitely. That is, neither Tom nor Jerry know how many times the game will be played and assume that their interaction will continue indefinitely. Would it be possible for them to cooperate in this context? What interest rate would be required for indefinite cooperation to be sustainable?
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