Checklist Review Week 5

1. I know the difference between a propriety and shared option, and I can name an
example of both types of options.

 See Lecture video “Introduction to Game Theory” in Section 5.1 for an intro-
duction to game theory and its fundamentals

2. I understand the tradeoff between flexibility and commitment.

 See Lecture video “Introduction to Option Games” in Section 5.1 for an intro-
duction to option games and its fundamentals

3. I can identify situations in which option games can be particularly useful.

 See Lecture video “Introduction to Option Games” in Section 5.1 for an intro-
duction to option games and its fundamentals

4. I know what a dominant strategy is and I understand how to solve for a sub-game
perfect equilibrium and a Nash Equilibrium.

 See Lecture video “How to Solve any Game” in Section 5.2 for a detailed review
of Game Theory

5. I understand the difference between an equilibrium in pure strategies and an equi-

librium in mixed strategies.

 See Lecture video “How to Solve any Game” in Section 5.2 for a detailed review
of Game Theory

6. I know how to solve a game by applying the (aforementioned) Game Theory prin-
ciples.

 See Lecture video “How to Solve any Game” in Section 5.2 for a detailed review
of Game Theory
 See Lecture video “How to Solve a Simultaneous Game” in Section 5.2 for a
detailed application of a simultaneous game
 Practice the “Simultaneous Game” and “Sequential Game” quizzes in Section
5.2 and review the solutions

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7. I understand the difference between a simultaneous game and a sequential game.

 See Lecture video “How to Solve any Game” in Section 5.2 for a detailed review
of Game Theory
 See Lecture video “How to Solve a Simultaneous Game” in Section 5.2 for a
detailed application of a simultaneous game
 Practice the “Simultaneous Game” and “Sequential Game” quizzes in Section
5.2 and review the solutions

8. I can solve a game with asymmetric information.

 Practice the “Game with Asymmetric Information” in Section 5.2 and review
the solutions

9. I know how to solve an option game.

 See Lecture video “How to Solve an Option Game” in Section 5.3 for a detailed
application of an option game