ECON 373 Study Guide - Fall 2019, Comprehensive Final Exam Notes - Wwe Raw, Xpression Fm, Nostril
1 Apr 2019
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2,2: u(a) > u (b+) > u (b-) > u(c)- not preferences but inequalities, 3 2 1 0, this is known as dominant strategy. If you put more than 67, you"re not rational. Eliminate numbers because you"re assuming not only are you rational, but others are rational as well! Lottery ticket example: you"re not rational if you buy the 000 rather than the 000. Grade matrix vs. payoff matrix: doesn"t matter what the number is as long as it is followed in order. Two strategies {many, few: combinations (many, many) (few, few) - both will get c grade (many, few)- many gets a, and few gets f (few, many), few gets f, and many get,s a. Avg = 100: 2/3 * avg = 67, so everything between 67-100 is dominated. If you"re rational player, you wouldn"t put any number over 100: dominated by any number between 1-66.
