ltaneously choose the action Left or Right. The payoff matrix/table that follows shows the payoff each person will earn as a function of both of their choices. For example, the lower right cell shows that if Clancy chooses Right and Eileen chooses Right, Clancy will receive a payoff of 3 and Eileen will receive a payoff of 6. Eileen Left Right

ltaneously choose the action Left or Right. The payoff matrix/table that follows shows the payoff each person will earn as a function of both of their choices. For example, the lower right cell shows that if Clancy chooses Right and Eileen chooses Right, Clancy will receive a payoff of 3 and Eileen will receive a payoff of 6. Eileen Left Right

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter9: Decision Making Under Uncertainty

Section9.2: Elements Of Decision Analysis

Problem 1P

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Solving for dominant strategies and the Nash equilibrium

Suppose Clancy and Eileen are playing a game in which both must simultaneously choose the action Left or Right. The payoff matrix/table that follows shows the payoff each person will earn as a function of both of their choices. For example, the lower right cell shows that if Clancy chooses Right and Eileen chooses Right, Clancy will receive a payoff of 3 and Eileen will receive a payoff of 6.

	Eileen
Left	Right
Clancy	Left	5, 6	5, 5
Right	4, 2	3, 6

The only dominant strategy in this game is for to choose .

The outcome reflecting the unique Nash equilibrium in this game is as follows: Clancy chooses and Eileen chooses .

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