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Suppose Manuel and Poornima are playing a game in which both must simultaneously choose the action Left or Right
Suppose Manuel and Poornima are playing a game in which both must simultaneously choose the action Left or Right. The payoff matrix that follows shows the payoff each person will earn as a function of both of their choices. For example, the lower-right cell shows that if Manuel chooses Right and Poornima chooses Right, Manuel will receive a payoff of 5 and Poornima will receive a payoff of 1.
| Poornima | |||
| Left | Right | ||
| Manuel | Left | 4, 4 | 6, 7 |
| Right | 2, 4 | 5, 1 | |
The only dominant strategy in this game is for------ to choose -------- .
The outcome reflecting the unique Nash equilibrium in this game is as follows: Manuel chooses-------- and Poornima chooses --------- .
Expert Solution
Answer: the only dominant strategy in the game is for Manuel to choose left because if poornima is choosing left , Manuel have 2 options either to choose left and right so Manuel is choosing left due to getting higher payoff as 4 instead of 2. If poornima is choosing right , then Manuel is still choosing left due to get higher payoff as 6 instead of 5 . So poornima is whatever strategy choosing left or right , Manuel is only choosing left. So Manuel have dominant strategy to choose left .
Answer :
The outcome reflecting the unique Nash equilibrium in this game is as follows: Manuel chooses left and Poornima chooses right . Both are getting satisfied by choosing this strategy because both dont have any incentive to alter their payoff..
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