Solving for dominant strategies and the Nash equilibrium
Suppose Antonio and Caroline are playing a game in which both must simultaneously choose the action Left or Right. The payoff matrix 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 Antonio chooses Right and Caroline chooses Right, Antonio will receive a payoff of 3 and Caroline will receive a payoff of 7.
Caroline
Left Right
Antonio Left 4,6 6,8
Right 7,5 3,7
The only dominant strategy in this game is for to choose The outcome reflecting the unique Nash equilibrium in this game is as follows: Antonio chooses and Caroline chooses .
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Solving for dominant strategies and the Nash equilibrium
Suppose Antonio and Caroline are playing...
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