Linus and Rerun share 300 dollar according to the following rule: each chooses one of the...

 

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Linus and Rerun share 300 dollar according to the following rule: each chooses one of the numbers, either 0, 1, 2, or 3. If the sum of their numbers is not greater than 3, then each receives the number he chose times 100 dollar. If the sum of their numbers is greater than 3, then both receive nothing and the 300 dollar is donated to a charity. 1. Formulate this situation as a normal form game. Represent their payoff by using a matrix. 2. Find all pure strategy Nash equilibria. 3. Find all mixed Nash equilibria. Linus and Rerun share 300 dollar according to the following rule: each chooses one of the numbers, either 0, 1, 2, or 3. If the sum of their numbers is not greater than 3, then each receives the number he chose times 100 dollar. If the sum of their numbers is greater than 3, then both receive nothing and the 300 dollar is donated to a charity. 1. Formulate this situation as a normal form game. Represent their payoff by using a matrix. 2. Find all pure strategy Nash equilibria. 3. Find all mixed Nash equilibria.

Answer rating: 100% (QA)

Step 13 This situation can be represented as a normal form game with two players Linus and Rerun There are four possible strategies for each player ch... View the full answer