Unit 4.3 And 4.4

Question 1

What is the the Nash equilibrium

Answer 1

A list of strategies one for each player such that no player can get a better payoff by switching to some other strategy that is available while the the players adhere to strategies specified for them

Question 2

What are dominant strategies

Answer 2

If a strategy is always the players response it is strictly dominant

Question 3

What is dominant strategy equilibrium

Answer 3

When both dominant strategies form an equilibrium

Question 4

Explain dominant vs dominated

Answer 4

Dominant regardless of chosen strategy chosen of the other player

Dominated is regardless of the belief of other player strat it’s never best response

Question 5

What is social optimum

Answer 5

Socially optimal outcome where payoffs are added together