You and your partner are choosing how much effort to put towards a group project for a course. You both care about the quality of the project, which increases in both of your effort choices. But you both also pay a cost of effort. You are enjoying the course much more than your partner, so your cost of effort is lower. Where y and p denote the amount of effort put by you and your partner, respectively, • Your payoff is 72yp – y³ . • Your partner's payoff is 72yp – 8p°. Decisions about effort provision are made simultaneously. Answer the following questions about the set of pure strategy Nash equilibria of this game. Please round to 3 decimal places where rounding is needed. a) In one pure strategy Nash equilibrium, you put more effort towards the project than your partner. In this Nash equilibrium, what is your effort level? b) In one pure strategy Nash equilibrium, you put the same level of effort towards the project as your partner. In this Nash equilibrium, what is your effort level?

You and your partner are choosing how much effort to put towards a group project for a course. You both care about the quality of the project, which increases in both of your effort choices. But you both also pay a cost of effort. You are enjoying the course much more than your partner, so your cost of effort is lower. Where y and p denote the amount of effort put by you and your partner, respectively, • Your payoff is 72yp – y³ . • Your partner's payoff is 72yp – 8p°. Decisions about effort provision are made simultaneously. Answer the following questions about the set of pure strategy Nash equilibria of this game. Please round to 3 decimal places where rounding is needed. a) In one pure strategy Nash equilibrium, you put more effort towards the project than your partner. In this Nash equilibrium, what is your effort level? b) In one pure strategy Nash equilibrium, you put the same level of effort towards the project as your partner. In this Nash equilibrium, what is your effort level?

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter7: Uncertainty

Section: Chapter Questions

Problem 7.8P

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You and your partner are choosing how much effort to put towards a group project for a course . You both care about the quality of the project , which increases in both of your effort choices . But you both also pay a cost of effort . You are enjoying the course much more than your partner , so your cost of effort is lower . Where y and p denote the amount of effort put by you and your partner , respectively , • Your payoff is 60yp - y³ . • Your partner's payoff is 60yp - 8p³ . Decisions about effort provision are made simultaneously . Answer the following questions about the set of pure strategy Nash equilibria of this game . Please round to 3 decimal places where rounding is needed . a ) In one pure strategy Nash equilibrium , you put more effort towards the project than your partner . In this Nash equilibrium , what is your effort level ? b ) In one pure strategy Nash equilibrium , you put the same level of effort towards the project as your partner . In this Nash equilibrium ,…
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