Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Two pigs, one dominant and the other subordinate, are put in a box. There is a lever at one of the box which, when pressed

Two pigs, one dominant and the other subordinate, are put in a box. There is a lever at one of the box which, when pressed dispenses 6 units of food at the other end.

Assume that the cost to each pig of pressing the lever and running to the other end is equal to half a unit of food.

Assume that if the subordinate pig presses the lever that by the time the subordinate pig gets to the other end that the dominant pig has eaten all the food.(And the dominant pig didn't have to run from one end of the box to the other.)

Assume that if the dominant pig presses the lever that by the time the dominant pig gets to the other end that the subordinate pig has eaten 5 of the 6 units of food. (And the subordinate pig didn't have to run from one end of the box to the other.)

Finally, assume that in the unlikely event that both press the lever that the subordinate pig is quicker than the dominant pig and gets to eat 2 units of food before the dominant pig shows up and pushes the subordinate pig out of the way. (And both pigs had to run from one end of the box to the other.)

  1. Set up matrix where both pigs must make a simultaneous decision.
  2. Find the equilibrium.
  3. If you get correctly you should come up with a surprising result. Comment on this surprising result and what might explain it.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managers And The Legal Environment

Authors: E. Bagley

9th Edition

1337555177, 978-1337555173

More Books

Students also viewed these Economics questions