Question

Player ll D EF A 10,3 2,-2 10,-1 Player B 3-3 4,3 7-2 C 2,5 3,06,1 In the strategic form game above, the set of rationalizable strategies for players 1 and 2 are respectively: 0 a. {A,B,C) and {D,E,F) b (A,B) and (D,E). c. {A,D) and {B,E). d. {A) and (D).

Answer 1

Answer:

b (A,B) and (D,E).

Explanation:

When player 1 chooses A then, player 2 has a more pay-off in choosing D. And when player 1 chooses B then, player 2 has more pay-off in choosing E. And when player 1 chooses C then , player 2 has more pay-off in choosing D. Therefore, for player 2 the set of rationalizable strategies are [D , E].

Similarly, when player 2 choose D the, player 1 has more pay-off in choosing A . And when player 2 chooses E then, player 1 has more pay-off in choosing B. And when player 2 chooses F then, player 1 has more pay-off in choosing A . Therefore, for player 1 the set of rationalizable strategies are [A, B].