Problem 2.

Two men are about to enter in a train. Two seats (adjacent) are empty but the seats are cramped. They have to take a decision to sit on the seat or stand. Sitting alone is very comfortable then both of them sitting, which is better than standing.

a)Write a payoff matrix of the above game using your own numbers for payoff. Assume that each man care about his own comfort. Find the Nash Equlibrium of the game.

b)Now assume that the each man is unselfish, who ranks the outcome based on other person's happiness. Therefore he prefers to stand than to sit if the other person stands. Now again write the payoff matrix and find the nash equlibiruim.