Chapter2: Mathematics For Microeconomics
Section: Chapter Questions
Problem 2.15P
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Question
Normal Form: Which one of the following descriptions below is CORRECT according to this Normal Form shown?
1.) If Player 2 believes that Player 1 randomly choose H or L with same probability, then Player 2's expected for choosing HC is 2.
2.) If Player 1 has 20% chance to play H and 80% chance to play L, Player 2 has 40% chance to play HD and 60% chance to play LC; then Player 1's expected payoff is 2.
3.) If Player 2 randomly play one of its 4 strategies without any preference, then Player 1's expected payoff for playing L is 2.5.
4.) If Player 2 believes that Player 1 has no probability to play L, then Player 2 would prefer to choose HC or HD.
Transcribed Image Text:2
1
НС
LC
HD
LD
0, 4
0,4
3, 3
3, 3
Н
1, 1
1, 1
4, 0
4, 0
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