Question

Question 4

1. John and Louise are trying to figure out how to spend their Saturday night. They will do things together, but value the following three possible activities differently. They can go to a music concert, watch the tennis or have a picnic in the park. John would prefer to go to the concert but Louise does not really like the music that will be played. Meanwhile, Louise wants to have a picnic but John does not really like the outdoors. Answer the following questions.

   1. Who has the dominant strategy? Blank 1 (Type J for John or L for Louise).
   2. What is the dominant strategy? Blank 2 (Type M for Music Concert, T for Tennis, or P for Picnic).

   			Louise
   		Music Concert (M)	Tennis (T)	Picnic (P)
   	Music Concert (M)	40,10	15,0	5,15
   John	Tennis (T)	0,0	15,15	0,25
   	Picnic (P)	0,0	0,0	10,50

Answer 1

a. The pay offs of the game above show that Louise has a dominant strategy.

b. Going to the Picnic is the dominant strategy of Louise. This is because no matter what the other player John does, the pay off of Louise are highest when Louise is going to the picnic. Thus, going to the picnic is the dominant strategy of Louise.