2. Paul and Stella play a game with three strategies each, T, M, and B for Paul, and L, C, and R for Stella. Both move simultaneously. The payoffs are given by the following form: Stella L R Paul T (8,4) (10, 2) (2,3) M (4,2) (10, 1) (5,7) B (1,4) (10, 3) (9,-4) a. Which strategy is dominated? b. What is the pure-strategy Nash equilibrium? Identify all if there are more than one. c. If Paul moved first, so that Stella observed it, which strategy would Paul choose?

2. Paul and Stella play a game with three strategies each, T, M, and B for Paul, and L, C, and R for Stella. Both move simultaneously. The payoffs are given by the following form: Stella L R Paul T (8,4) (10, 2) (2,3) M (4,2) (10, 1) (5,7) B (1,4) (10, 3) (9,-4) a. Which strategy is dominated? b. What is the pure-strategy Nash equilibrium? Identify all if there are more than one. c. If Paul moved first, so that Stella observed it, which strategy would Paul choose?

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter17: Oligopoly

Section: Chapter Questions

Problem 5CQQ

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