Econ 121b: Intermediate Microeconomics
نویسنده
چکیده
While the idea of a matching pennies game may seem contrived, it is merely the simplest example of a general class of zero-sum games, where the total payoff of the players is constant regardless of the outcome. Consequently gains for one player can only come from losses of the other. For this reason, zero-sum games will rarely have a pure strategy Nash equilibrium. Examples would be chess, or more relevantly, competition between two candidates or political parties. Cold War power politics between the US and USSR was famously (although probably not accurately) modelled as a zero-sum game. Most economic situations are not zero-sum since resources can be used inefficiently.
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Midterm Examination Solutions ECON 504 - Microeconomics II
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