Solving for dominant strategies and the Nash equilibrium Suppose Paolo and Sharon 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 Paolo chooses Right and Sharon chooses Right, Paolo will receive a payoff of 9 and Sharon will receive a payoff of 8. Paolo Average/2 Left Right Sharon Left 8,5 3,6 Right 8,7 9,8 The only dominant strategy in this game is for to choose The outcome reflecting the unique Nash equilibrium in this game is as follows: Paolo chooses and Sharon chooses
