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Q2 Comparative Statics of Mixed Strategy Equilibria Consider the following two-player game: P2 L R. T 12, 2 3, 9 P1 B 5,8 4, 2

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Q2 Comparative Statics of Mixed Strategy Equilibria Consider the following two-player game: P2 L R. T 12, 2 3, 9 P1 B 5,8 4, 2 (a) Find all the Nash equilibria, in pure and mixed strategies. Explain how you know that you have found all equilibria. (b) Suppose that the payoff of the player 2, u2(B, L), is reduced from 8 to 6, but all other payoffs remain the same. Again, find all Nash equilibria in the pure- and mixed-strategies. (c) Compare the mixed-strategy equilibria in parts (a) and (b). Did this worsening in one of player 2's payoffs change player 2's equilibrium mixed strategy? Does it change player 1's equilibrium strategy? Give some intuition

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