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11/19/2017 07:08 AM by Josh; Picasso | There are 6 NE in total, 4 pure and 2 mixed. For (seller,buyer), the pure NE are (1,1), (2,2), (3,1) and (3,3), which you can easily check by making a table and underlining best responses.
As for the mixed NE, the buyer should also [View full text and thread]
11/19/2017 06:40 AM by Josh; Picasso | There are 6 NE in total, 4 pure and 2 mixed. For (seller,buyer), the pure NE are (1,1), (2,2), (3,1) and (3,3), which you can easily check by making a table and underlining best responses.
As for the mixed NE, the buyer should also [View full text and thread]
09/28/2017 09:26 AM by Tobi; Nash Equilibrium_etc. | Hey,
Would be amazing if somebody could solve this problem for me. I have no clue, to be honest. Here it is:
A seller and a buyer try to agree on the price of a Picasso painting. In the
rest of this exercsie, all the values and [View full text and thread]
09/28/2017 09:26 AM by Tobi; Nash Equilibrium_etc. | Hey,
Would be amazing if somebody could solve this problem for me. I have no clue, to be honest. Here it is:
A seller and a buyer try to agree on the price of a Picasso painting. In the
rest of this exercsie, all the values and [View full text and thread]
09/27/2017 09:08 AM by Tobi; Nash Equilibrium_etc. | Hey, Would be amazing if somebody could solve this problem for me. I have no clue, to be honest. Here it is:
A seller and a buyer try to agree on the price of a Picasso painting. In the rest of this exercsie, all the values and payoffs are in millions of dollars (and I will omit mentioning it). The value of the Picasso for the seller is 1, while for the buyer is 3. Suppose the negotiation occurs as follows: both seller and buyer simultaneously propose a price pS, pB ∈ {1, 2, 3}. If the price offered by the buyer is at least as high as the one required by the seller, the transaction takes place and the painting changes hands at the average of the two proposed prices. 1. (5 points) Consider this situation as a strategic game and write down the associated payoff matrix. 2. (10 points) Find the set of all Nash equilibria in pure strategies. 3. (5 points) Show that all Nash equilibria in pure strategies are (Pareto) efficient. 4. (10 points) Construct an inefficient Nash equilibrium allowing for mixed strategies.
Thank you ! [Manage messages]
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