Answer to Question #46215 in Microeconomics for mohammed abdu

Question #46215
Consider the following payoff matrix: 1 2 1 $1,000 -$2,000 $2,000 -$1,000 Player A Strategy -$1,000 $2,000 2 -$2,000 $1,000 a. Does Player A have a dominant strategy? Explain why or why not. b. Does Player B have a dominant strategy? Explain why or why not.
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Expert's answer
2014-09-15T12:57:03-0400
a. Player A has a dominant strategy, he will preffer the strategy 1 to minimize possible losses and maximize possible gains. In our case both Player A and Player B will chose strategy 1, so Player A will get $2000 and Player B will get $1000.
b. Player B has a dominant strategy too, he will preffer the strategy 1 to minimize possible losses. That's why, in our case both Player A and Player B will chose strategy 1, so Player A will get $2000 and Player B will get $1000.

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