Exercises - Game Theory

SOLUTIONS

Question 1
Consider the following simultaneous games. For each game, list all pure and all mixed equi-
libria.
c d
(a) a −1, 1 3, 2
b 0, 2 1, 1
c d
(b) a 2, −1 0, 0
b 0, 1 1, 2
c d
(c) a −1, 1 1, −1
b 1, −1 −1, 1
d e f
a −1, 0 2, 2 1, −1
(d)
b 0, 1 1, −1 0, 4
c 1, 3 −1, 1 −1, 2
Solution

(a) There are two pure equilibria: (a, d) and (b, c). There is a mixed equilibrium at ( 12 a +
1 2 1
2 b, 3 c + 3 d).
(b) There is one pure equilibrium: (b, d). There is no mixed equilibrium.
(c) There is no pure equilibrium. There is a mixed equilibrium at ( 12 a + 12 b, 21 c + 12 d).
(d) There are two pure equilibria: (a, e) and (c, d). There is a mixed equilibrium at ( 12 a +
1 1 1 1
4 b + 4 c, 2 d + 2 f ).
Question 2
Can a simultaneous two-player game:
(a) Be zero-sum and not symmetric?
(b) Have no pure and no mixed equilibria?
(c) Be symmetric and have an odd number of pure equilibria?
(d) Be infinite and have a finite number of equilibria?
Can a simultaneous three-player game:
(e) Have a single pure equilibrium?
(f) Have a single mixed equilibrium?
(g) Be zero-sum?
(h) Be symmetric?
Solution
c d
(a) Yes. For instance: a −1, 1 −2, 2
b −3, 3 −4, 4
(b) No. Every game must have at least one equilibrium.
c d
(c) Yes. For instance: a 0, 0 0, 1
b 1, 0 1, 1

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 (d) Yes. As a silly example, take any game and add infinitely many options for each player
that all give a very low payoff, so nobody would choose them anyway.
(e) Yes. For example, take a game where all three players can choose between two options,
a and b, and the payoff function gives each player 1 if they chose a and 0 if they chose
b (independent of the others). Then only (a, a, a) is an equilibrium.
(f) Yes. For example, imagine a game where all three players can choose between two
options, a and b, and the payoff function gives each player 1 if they made a unique
choice. So, if two players pick a and one picks b, the player who picked b gets 1 and
the others get 0. If all three players pick the same, everybody gets 0. This game has a
single mixed equilibrium at ( 12 a + 12 b, 12 a + 12 b, 12 a + 12 b).
(g) Yes. It means that the sum of the three numbers in each payoff vectors is 0.
(h) Yes. For example, the games described at (e) and (f) are both symmetric.
Question 3
Consider the following impartial sequencial game. We are given the number 15. Two players
take turns, and can choose to either divide the number by 2 (if it is even), or to subtract 1 (this
is always allowed). The person who reaches 0 wins. Assuming both players play optimally,
who wins this game?
Solution
The key to solving this game is to work backwards. Let w : N → B indicate the winner of
the game when the number is n, where w(n) = true means the player whose turn it is wins.
Clearly, w(0) = false, since the other player just reached 0. Furthermore, we see that w(n) =
¬w(n − 1) for any odd number n, since the player has no choice but to subtract 1. Finally, we
have w(n) = ¬w(n − 1) ∨ ¬w(n/2) for any even number n, since the player can win if one of
the positions they can reach is losing for the other player. Now, we could simply evaluate w for
n 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
small values of n.
w(n) F T F T T F T F T F T F T F T F
We see that for n = 15, the starting player loses.
However, we could also be smarter and argue that, for n > 4, w(n) is always true when n
is even and false when n is odd. The reason is that for w(4) is true, which means that w(5)
is false. But now, for any even number larger than 4, we always have the choice of taking a
single element, which leads to a losing situation. So we never need to use the option to divide
by 2!