Candidate A and candidate B are running for the same elective office. Candidate

Question

Candidate A and candidate B are running for the same elective office. Candidate A is well known for having extreme statist/socialist (far left) political views. Candidate B is known as a staunch advocate of individual liberties/free-market (far right) political views. Research on voter preferences shown that the electorate falls into eight distinct voting blocs, ranging from the far left (0) to the far right (7). The arrangement of these voting blocs is depicted in the FIGURE. Assume that there are an equal number of voters in each voting bloc. To maximize their chances of winning the election, candidates A and B will adopt which of the following policy platforms {A, B} to maximize their chances of winning the election?

{2, 5}

{5, 2}

{3, 4}

{4, 3}

{7, 0}

{0, 7}

{2, 5}

{5, 2}

{3, 4}

{4, 3}

{7, 0}

{0, 7}

Explanation / Answer

Answer : We can solve this problem by using game theory. If candidate A is a first chooser then he will choose (7,0) because here 7 is the highest payoff for candidate A but in this case there is no option to choose other as total voting level is 7 which is selected by candidate A.

Similarly, if candidate B is the first chooser then he will choose (0,7) as 7 is the highest payoff for him and candidate A has no option to choose anything else.

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