Consider the Following Normal-Form Game AWhat Is Player B's Best Strategy in a Simultaneous-Move Play

question 89

Essay

Consider the following normal-form game.
$\begin{array}{l} \quad \quad \quad \quad \quad\text { Player B }\\\text { Player A }\begin{array}{|l|l|l|}\hline \text { Strategy } & \text { Left } & \text { Right } \\\hline \text { Top } & \$ 100, \$ 200 & -\$ 10, \$ 100 \\\hline \text { Bottom } & \$ 500,-\$ 50 & -\$ 100,-\$ 100 \\\hline\end{array}\end{array}$ a.What is player B's best strategy in a simultaneous-move play of this game?
b.What is player A's best strategy in a simultaneous-move play of this game?
c.What are player A and B's equilibrium payoff in a simultaneous-move play of this game?
d.Use an extensive-form representation to show that player B can earn higher payoffs by exercising a first-mover advantage.(Note:
Player B's payoffs will appear first in this extensive-form game since it is the first mover.)
e.List two things player B must do in order to be able to achieve these higher payoffs.

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Definitions:

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