2. John and Bob plan to meet for lunch. Both of them are unsure which of the tow

Question

2. John and Bob plan to meet for lunch. Both of them are unsure which of the town's two restaurants they decided on and neither has a phone or way of contacting the other. In this game they must each pick a restaurant to go to and the payouts for each are listed. John (J) Burger Restaurant Pizza Restaurant J=4 Bob (B) Burger RestaurantB 5 J=5 B-1 J=1 B-2 J- 8 B-3 Pizza Restaurant a) Does John have a dominant strategy? b) Does Bob have a dominant strategy? c What is the nash equilibrium'? d) Can either player be better off by deviating from the nash equilibrium? Why or why not?

Explanation / Answer

A) dominant strategy is a strategy which a player plays irrespective of other player action.

John have dominant strategy as playing Pizza restaurant.

B)Bob dont have dominant strategy.

C)(pizza restaurant, pizza restaurant) is a nash equilibrium.

D)no, no player have any incentive to deviate otherwise it would not have been nash equilibrium.

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