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EC206 - QUIZ1 - Answer Key

This document is a quiz for a microeconomics class. It contains two multiple choice questions. The first question defines weakly dominated strategies and Nash equilibrium in game theory. The second questions asks students to find the pure-strategy Nash equilibria for a 3-player normal form game and provides the correct answer.

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102 views

EC206 - QUIZ1 - Answer Key

This document is a quiz for a microeconomics class. It contains two multiple choice questions. The first question defines weakly dominated strategies and Nash equilibrium in game theory. The second questions asks students to find the pure-strategy Nash equilibria for a 3-player normal form game and provides the correct answer.

Uploaded by

Alp San
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Bo¼

gaziçi University, Department of Economics, Spring 2011


EC 206 MICROECONOMICS II
Quiz 1 - Answer Key
You have 12 minutes!

NAME and SECTION:

1. Let G = fS1 ; :::; Sn ; u1 ; :::; un g be an n-player normal form game.

(a) Write down the formal de…nition of weakly dominated strategy.


ANSWER: si is weakly dominated by s0i if
ui (si ; s i ) ui (s0i ; s i ) for all s i 2S i and
ui (si ; s i ) < ui (s0i ; s i ) for some s i 2 S i:
(b) Write down the formal de…nition of Nash equilibrium.
ANSWER: (s1 ; :::; sn ) is a Nash equilibrium if for each player i;
ui (si ; s i ) ui (si ; s i ) for all si 2 Si .

2. For the 3-player normal form game below, …nd all pure-strategy Nash equilibrium,
if any.

(1)/(2) L R L R
U (2*,2,2*) (3*,4*,2*) U (0,-3,1) (0*,2*,1)
D (1,2,3*) (1,7*,-8) D (5*,6*,3*) (-1,-4,7*)
X (3) Y

ANSWER: N Epure = f(U; R; X); (D; L; Y )g:

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