Exective Summary. Game Theory Is A Fascinating Subject.

The decisions or strategies one company chooses will likely motivate other competitors to respond. Using the game theory allows a company to assess and understand more about itself and its competitors so that it can adjust and shape the competition to maximize its win probability (Johnson, 2014). Some examples of how A&D companies apply the game theory in their decision making are:

Games can be very hard. States can be only observes to a certain extend. Multiple agents choose Actions, stochastic pays off and state transition depends on state and other

Good post and I choose game theory as well. Game theory deals with any situation in which the reward of any one player (called the payoff) depends on not only his or her own actions but also on those of other players in the game. Game theory provides a technique that is suited to investigate such interactions, but as applied in the research literature it is a far more mathematical treatment than might be suggested by our attempt to explain its nature in a simple way.

2. Understand the holistic nature of strategy and apply analytical techniques to solve complex problems in real life organizations

•In relation to Game Theory, the game of Hide and Seek happens to be an example of Zero- Sum Game.

Game theory cannot always predict reliable outcomes for real-life situations as it is more an

Nash equilibrium is a solution theory of a non-cooperative game which involves two or more

We begin looking for a mixed strategy by verifying that there is no pure strategy

Nash equilibrium can be described as the end of the game sequence. Player gains a posteriori experience during the sequences of the game which in turn help them to form the belief and gain knowledge that lead to the end point, the Nash equilibrium, hence there is no further knowledge that can be gained. In the usual finite set of games the marking of the end point, Nash equilibrium, will allow us to make better or optimal decision. If our decision making process doesn’t satisfy the Nash equilibrium, we must always be able to improve our decision and choice that we made till we hit that equilibrium.

Dominant strategy produces “a higher payoff than any other strategy the player can use for every possible combination of its rivals’ strategies” (Perloff). In other words, in game theory, strategic dominance results in better strategies than any other competitors. This will be explained more detailed later in this report.

In this game tree, the two player’s state of minds and actions are displayed. Consider the case scenario of Boeing and General Electric (GE) playing a sequential game, GE makes the first move in the process followed by Boeing based on their interpretation of GE’s

John F. Nash shared the 1994 Nobel Prize with John Harsanyi and Reinhard Selten in economics for their work on the theory of non-cooperative games, in other words John Nash received a Nobel Prize for his work in Game theory. Except for one course in economics that he took as an undergraduate, Nash had not any formal training in economics. John Nash had a Ph.D. in mathematics in 1950, but the Nobel Prize he received four decades later was for the contribution he made to game theory in his 1950 Ph.D. thesis. In his work, he introduced the distinction between cooperative and non-cooperative games. In non-cooperative games every player is self-enforced, and in cooperative games, players can make agreements with other players. Nash’s contribution is the concept of equilibrium for non-cooperative games, which later came to be called a Nash equilibrium. In Nash equilibrium no player can improve his position by choosing a different strategy. Nash explained that as long as mixed strategies are allowed, for a broad class of games, at least one equilibrium exist. Another Nash’s contribution is his reasoning about “the bargaining problem,” before Nash, economist thought the share of gains each of two parties to a bargain received was always indeterminate. But Nash got further by suggesting four conditions and showed mathematically that a unique solution

Your thoughts on other aspects of Game theory that can be applied for this problem

theory described in the introduction of the essay, however, what does it actually deliver, that is the main focus of this essay. Modern game theory has been developing now for more than 50 years since the book Theory of Games and Economic Behavior by John von Neumann and Oskar Morgenstern was published in 1944. However, it must be noted that some important efforts in explaining the strategic choices – strategic decision making has been done also before, for example by Zermelo. Konong, Kalmar and Borel. Game theory has evolved considerably since the publication of von Neuman and Morgenstern’s book and what is interesting the theory has developed far beyond its initial mathematical boundaries. This is due in a large part to contributions in the 1950s from John Nash (1950, 1951). However, it was in the 1970s

The subject's behavior in a situation where a decision on further action presupposes possible retaliatory actions by other market entities is called strategic behavior. Such behavior is studying the theory of games (game theory). This branch of mathematics is designed for analysis of equilibrium and possible strategies for the participants in the "game" situations, that means when the decision of one party affect the position of others. Game theory helps us understand oligopoly and other situations where “players” interact and behave strategically.