concept of subgame perfect Nash equilibrium (SPNE): (I) This concept only applies to finite games, not infinitely repeated games. (II) Some dynamic games might have a SPNE that is not a Nash Equilibrium. (III) The concept of SPNE rules out situations where a player would be acting against

Microeconomic Theory
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Chapter8: Game Theory
Section: Chapter Questions
Problem 8.1P
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Consider the following statements about the concept of subgame perfect Nash equilibrium (SPNE): (I) This concept only applies to finite games, not infinitely repeated games. (II) Some dynamic games might have a SPNE that is not a Nash Equilibrium. (III) The concept of SPNE rules out situations where a player would be acting against their own interest in some subgames.

Group of answer choices

a. Only I is correct.

b. All options are incorrect.

c. Only II is correct

d. Only III is correct

e. More than one option is correct

 

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