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3) Netflix with unlimited sharing Netflix is an American media-services provider and production company headquartered in Los Gatos, California

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3) Netflix with unlimited sharing Netflix is an American media-services provider and production company headquartered in Los Gatos, California. The company's primary business is its subscription-based streaming service which offers online streaming of a library of films and tv programs. There is a society of six individuals, { 1, 2, 3, 4, 5, 6}, who are connected in a social network as below. If there is a link between two individuals, then that pair of individuals are friends. If there is no link between two individuals, then that pair are not friends. 

All individuals like Netflix. Specifically, if someone views Netflix they get a benefit of 1. However, Netflix is costly which is bad. To purchase a Netflix account costs c E (0,1). Netflix allow multiple devices to stream simultaneously. This means that if some indi-vidual purchases a Netflix account, then he/she will share with all of his/her friends. Each individual has strategy set {0,1} where 1 means to purchase a Netflix account and 0 means to not purchase. The payoff to individual i depends directly on what his/her friends do. Writing si for the strategy of person i, and for the vector of strategies of everyone other than i, the payoff to person i, s_i) is 
1, if some friend chose to purchase an account (0, s_i) = 0, if no friend chose to purchase an account 7r;(1, s_;) = 1 — c, for all s_, 
Answer the following: 
(a) 
(b) 
(c) 
Is marks' 
15 marks' 
15 marlcs1 
Does any player have a dominant strategy (strictly or weakly)? Does any player have a dominated strategy (strictly or weakly)? Find all the pure strategy nash equilibria. 
(Either write out mathematically or depict graphically.) 
 

4. Netflix with constrained sharing Now suppose that Netflix change their sharing policy. The purchaser of a Netflix account is now only allowed to share with a fixed number of others. Specifically, each Netflix account may only be viewed by the account purchaser and ic other people. If an account holder has (strictly) more than K friends then he/she must choose exactly K to share with. If an account holder has less than K friends then he/she may share with all of them. 
Suppose that the social network is unchanged. That is, it remains like this: 
Answer the following: 
(a) 
(b) 
15 marks 1 
IS marks  

Write out the strategy set for player 1 for n = 1,2, and 3. 
Write out the strategy set for player 3 for is = 1,2, and 3. 
(c) 115 marks' Find all the pure strategy nash equilibria for K = 1,2, and 3. (Either write out mathematically or depict graphically.) 
(d) 
15 marks1 
What value for it is optimal for Netflix?