Two Players Are Engaged in a Game of Chicken

question 27

Multiple Choice

Two players are engaged in a game of Chicken.There are two possible strategies, Swerve and Drive Straight.A player who chooses to Swerve is called Chicken and gets a payoff of zero, regardless of what the other player does.A player who chooses to Drive Straight gets a payoff of 32 if the other player swerves and a payoff of -48 if the other player also chooses to Drive Straight.This game has two pure strategy equilibria and

• A)a mixed strategy equilibrium in which each player swerves with probability .60 and drives straight with probability .40.
• B)two mixed strategies in which players alternate between swerving and driving straight.
• C)a mixed strategy equilibrium in which one player swerves with probability .60 and the other swerves with probability .40.
• D)a mixed strategy in which each player swerves with probability .30 and drives straight with probability .70.
• E)no mixed strategies.

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Definitions:

Northwest-corner Rule

A method used in transportation problem solutions in operations research, starting allocation from the northwest corner of a cost matrix and moving through the matrix to minimize costs.

Transportation Problem

A type of optimization problem in operations research aimed at determining the most efficient way of allocating resources to transport goods from suppliers to consumers, minimizing cost.

Transportation Problem

A type of optimization problem in logistics aiming to determine the most efficient way to distribute goods from multiple suppliers to multiple consumers.

Shipping Cost

The expense associated with moving goods from one location to another, including packing, logistics, and transportation fees.