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Problem Set 6

The document is a problem set focused on game theory, specifically addressing mixed and behavioral strategies in extensive-form games. It includes problems on finding equivalent behavioral strategies, computing Nash equilibria, and formulating a parlor game with imperfect information. The problems require players to analyze strategies and outcomes based on given probabilities and game structures.

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32 views2 pages

Problem Set 6

The document is a problem set focused on game theory, specifically addressing mixed and behavioral strategies in extensive-form games. It includes problems on finding equivalent behavioral strategies, computing Nash equilibria, and formulating a parlor game with imperfect information. The problems require players to analyze strategies and outcomes based on given probabilities and game structures.

Uploaded by

jocelyn.dao.innovaturebpo
Copyright
© © All Rights Reserved
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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Game Theory

Problem Set 6

1. (Mixed and behavioral strategies) Consider the following extensive-form game.

A B
2

L M R
1

l r l r

(a) Let 1 denote player 1’s mixed strategy in which she plays (B; r) with probability 0:4;
(B; l) with probability 0:1; (A; r) with probability 0:3, and (A; l) with probability 0:2.
Find the behavioral strategy of player 1 that is equivalent to 1 : Can you …nd other
mixed strategies that are equivalent to 1 ?

(b) Compute a behavioral strategy of player 1 that is equivalent to her mixed strategy in
which she plays (B; r) with probability 0:7; (B; l) with probability 0:3: Is the behavioral
strategy uniquely de…ned? Explain.

2. (Nash equilibria of an extensive-form game) Consider the following game. Player


1 …rst decides between to games A or B; then the game chosen by player 1 is played
simultaneously. Player 1 knows which game is played, but player 2 does not know.

A B
L R L R
U 1; 0 0; 1 U 4; 3 3; 2
D 1; 2 2; 0 D 1; 0 0; 0

(a) Find an arbitrary mixed strategy Nash equilibrium of this game in which each pure
strategy is played with positive probability. (Be careful in specifying the strategy space
of each player).

1
(b) For the mixed strategy equilibrium you obtained in part b), give an equivalent pre-
sentation in behavioral strategies. (Be careful that mixed strategies and behavioral
strategies generate the same distribution over terminal nodes).

3. (A parlor game) Formulate the following parlor game as an extensive-form game


with imperfect information. First player 1 receives a card that is either H or L with
equal probabilities. Player 2 does not see the card. Player 1 may announce that her
card is L; in which case she must pay $1 to player 2; or may claim that her card is H;
in which case player 2 may choose to concede or to insist on seeing player 1’s card. If
player 2 concedes then he must pay $1 to player 1: If he insists on seeing player 1’s
card then player 1 must pay him $4 if her card is L and he must pay her $4 if her card
is H:
De…ne the set of strategies of each player and …nd the Nash equilibria of this game.

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