Tutorial 1

Question 1

Dominant strategy

Answer 1

A strategy that produces a higher payoff than any other strategy the player can use for every possible combination of its rivals’ strategies.

Question 2

Prisoners’ dilemma

Answer 2

A game in which all players have dominant strategies that result in profits (or other payoffs) that are inferior to what they could achieve if they used cooperative strategies.

Question 3

Best response

Answer 3

The strategy that maximizes a player’s payoff given its beliefs about its rival’s strategies.

Question 4

Nash equilibrium

Answer 4

A set of strategies such that, when all other players use these strategies, no player can obtain a higher payoff by choosing a different strategy.

Question 5

Static games

Answer 5

Games in which each player acts only once and the players act simultaneously.