Question
Consider a bargaining game:
src="https://www.ixambee.com/questionimage/Chapter/1645520198-6.PNG" alt="" /> Find pure strategy Nash equilibrium.Solution
Suppose 1 chooses “low” then best response of 2 will be to choose “yes”. Now consider the other way round if 2 chooses “yes” then 1’s best response will be “low”. So neither of two would want to deviate. Applying the same logic to other points we deduce {low, yes} is the only Nash Equilibrium.
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