The Difference Between a Nash Equilibrium and a Subgame-Perfect Equilibrium

question 13

Multiple Choice

The difference between a Nash equilibrium and a subgame-perfect equilibrium is:

• A)the former requires rational play both on and off the equilibrium path but the latter requires rational play only on the equilibrium path.
• B)the former requires rational play only on the equilibrium path but the latter requires rational play both on and off the equilibrium path.
• C)Nash equilibria are a subset of the subgame-perfect equilibria.
• D)nothing;they are synonyms.

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Definitions:

Merger

The combination of two or more companies into a single entity, typically with the aim of boosting competitiveness or market share.

Join Forces

To unite or collaborate with others for a common purpose or goal.

One Entity

Refers to a singular organization, business, or individual regarded as a single unit for legal, financial, or operational purposes.

Merger

The combination of two or more companies into a single entity, with the goal of increasing market share or efficiency.