Dr. Vidya Atal Strategic Thinking & Game Theory

Module 2 Assignment Answer all the questions. Remember that every part of the question has points assigned; by just submitting an

answer to each part you can get 50% submission credit, but if you do not submit an answer to a part, you get 0. So play strategically! Please upload the images of your answers on Canvas before the due date.

1. While I am away on a conference, my husband Souptik plans to take the kids, Wrik and Oeshi, on an outing. Wrik prefers to go to the park (P), whereas Oeshi prefers to go to the performance art studio (A). Each child gets 5 units of utility from his/her more preferred activity and only 3 units from the less preferred activity. Souptik gets 3 units of utility for either of the two activities.

To make a decision, Souptik plans to ask Wrik first for his preference, then to ask Oeshi after she hears Wrik’s choice. Each kid can either choose P or A. If both of them choose the same activity, then that is what they will do. If they choose different activities, Souptik will make a tie-breaking decision. As the dad, he has an additional option: he can choose P, or A, or his personal favorite hiking (H). Each kid gets 1 unit of utility from H and Souptik gets 5 units from it.

(a) Drawthecompletegametree (withpayoffs). Describe each possiblepure strategyeachplayerhas. (10×2 = 20 points)

(b) Find out the equilibrium strategies and corresponding payoffs for each player. (10 points)

2. For each one of the following games, answer the questions:

(a) Name the players of the game and describe each player’s actions. (10×2 = 20 points) (b) Describe each possible pure strategy each player has. (10×2 = 20 points) (c) What do you think will be the equilibrium strategy and pay-off for each player in this game? (5×2 = 10

points)

Game 1

Game 2

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