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Use the following normal-form game to answer the questions below. Player 1 Strategy A B a. Identify the one-shot Nash equilibrium O(BC) O(AD) Player
Use the following normal-form game to answer the questions below. Player 1 Strategy A B a. Identify the one-shot Nash equilibrium O(BC) O(AD) Player 2 S D 40, 40 10, 90 90, 10 45, 45 O(AC) (B.D) b. Suppose the players know this game will be repeated exactly three times Can they achieve payoffs that are better than the one- shot Nash equilibrium? No Yes c. Suppose this game is infinitely repeated and the interest rate is 6 percent Can the players achieve payoffs that are better than the one-shot Nash equilibrium? No O Yes d. Suppose the players do not know exactly how many times this game will be repeated, but they do know that the probability the game will end after a given play is 8. If 8 is sufficiently low, can players eam more than they could in the one-shot Nash equilibrium?
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