Please answer all parts to the question! GE, IBM and Xerox use water from the Hu

Question

Please answer all parts to the question! GE, IBM and Xerox use water from the Hudson river for production purposes. Each firm has 2 strategies, purify sewage (P) or dump raw sewage (D). If zero or one firm chooses D, the water remains pure. But if two or three firms choose D, then the water becomes polluted and each firm suffers a loss of 3. The cost of purification, P, is 1. Compute all Nash equilibria of this game. Consider the strategic nuclear situation between US and North Korea. North Korea must decide whether to keep its nuclear weapons or destroy them. The US must decide whether to spy on North Korea or not. It would an international scandal for North Korea Wolis en o at Noeo pig l pn The as follows: US Don't Spy Northkorea-Heep Destroy 0. 2 (a) Does either player have a strictly dominant strategy? (b) Does either player have a weakly dominant strategy? (e) Find a Nash Equilibrium in which neither player employs a weakly dominant strategy

Explanation / Answer

Ans a)

If we compare North KOrea payoff within its 2 different strategies then we get,

-1<0 & 1>0 hence no strictly or weakly dominant strategy, similarly for US 1<-1 & 2=2 hence US have no strictly dominant but weakly dominant strategy as "Spy"

Hence no Player has strictly dominant strategy

Ans B)

US have weakly dominant strategy

Ans C)

As US have weakly dominant strategy as "Spy" and Korea have none then as per the condition given in quesion we can say that US wont play "Spy" hence Nash equilibrium then will be (Keep.Dont Spy)

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.