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ECN214 Games and Strategies – 2008 Questions and Answers $5.15
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  7. ECN214 Games and Strategies (ECN214)

Exam (elaborations)

ECN214 Games and Strategies – 2008 Questions and Answers

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  • Course
  • ECN214 Games and Strategies (ECN214)
  • Institution
  • Queen Mary, University Of London (QMUL)

High-quality past paper questions and answers for the ECN214 Games and Strategy module for the Queen Mary University of London (QMUL) Economics Course. Each question is reproduced and high-quality full-mark scores are written up clearly for each one. Great for preparing for exams, studying and soli...

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Document information

  • June 7, 2020
  • 7
  • 2007/2008
  • Exam (elaborations)
  • Questions & answers

Subjects

  • games and strategy
  • game theory
  • economics

Written for

  • Queen Mary, University of London (QMUL)
  • Economics
  • ECN214 Games and Strategies (ECN214)
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ECN214 Games and Strategies – 2008
Questions and Answers

Part A
Question 1




a) Underlining the best responses in pure strategies:

l c R
U 2, 3 0, 3 2, 1
D 1, 4 0, 4 5, 3

Therefore, the pure strategy Nash equilibria are (u, l), (u, c), and (d, r).

b)

Deleting weakly dominant strategies:

l c R
U 2, 3 0, 3 2, 1
D 1, 4 0, 4 5, 3


l c R
U 2, 3 0, 3 2, 1
D 1, 4 0, 4 5, 3


Only (u, l) survives.

, FOR MORE HIGH-QUALITY PAST PAPER MODEL ANSWERS, ONLINE TUTORING AND
ECONOMICS HELP, visit LondonEconomicsTutors.co.uk.
Discounted prices compared to all other websites

Question 2




a) Underlining the best responses in pure strategies:

l r
U 4, 2 1, 0
D 3, 3 0, 4


Thus the only pure strategy Nash equilibrium is (u, l).

b) To find the mixed strategy Nash equilibria, we set the probabilities such that the expected value
of each action are equal for both players.

𝐸[𝑢] = (4)𝜌 + (1 − 𝜌)1 = 1 + 3𝜌
𝐸[𝑑] = (3)𝜌 + (1 − 𝜌)5 = 5 − 2𝜌
1 + 3𝜌 = 5 − 2𝜌
5𝜌 = 4
𝜌 = 4/5
𝐸[𝑙] = (2)𝜋 + (1 − 𝜋)3 = 3 − 1𝜋
𝐸[𝑟] = (1 − 𝜋)4 = 4 − 4𝜋
3 − 1𝜋 = 4 − 4𝜋
𝜋 = 1/3
c) x = 2.

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