Imagine that initially economic agents believe that P(A > B) = p > /1. Furthermore, imagine...
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Imagine that initially economic agents believe that P(A > B) = p > ½/1. Furthermore, imagine that investors receive signals that reveal the truth with probability q > p > 1. Consider a sequential game with N agents with agent 1 making her choice first. Assume that signals received are only privately known, but choices are publicly observable. Imagine that the sequence of signals received is given with $₁ = A, 82 83 = ... = SN B. Assume that N is large. Which of the two options is better (the probability that it is better is close to 1)? a) A b) B c) both are equally good d) cannot tell unless the precise values of q and p are known Imagine that initially economic agents believe that P(A > B) = p > ½/1. Furthermore, imagine that investors receive signals that reveal the truth with probability q > p > 1. Consider a sequential game with N agents with agent 1 making her choice first. Assume that signals received are only privately known, but choices are publicly observable. Imagine that the sequence of signals received is given with $₁ = A, 82 83 = ... = SN B. Assume that N is large. Which of the two options is better (the probability that it is better is close to 1)? a) A b) B c) both are equally good d) cannot tell unless the precise values of q and p are known
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ANSWER C Both are equaly good Sequence signals may be defined as linguistic forms that os tensively ... View the full answer
Related Book For
Manufacturing Processes for Engineering Materials
ISBN: 978-0132272711
5th edition
Authors: Serope Kalpakjian, Steven Schmid
Posted Date:
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