Suppose a stage game has exactly one Nash equilibrium select
Suppose a stage game has exactly one Nash equilibrium (select all that apply)
The Folk Theorem introduced in the notes assumes that actions are observable.
In a finitely repeated game where T becomes large, different outcomes can be supported as SPNE.
In a finitely repeated game where players become more patient results other than the stage NE become feasible.
In the SPNE of the twice repeated game players play the stage NE in both periods.
Any outcome can be supported as a SPNE when the game is repeated infinitely many times and players are patient enough.
you can select more than 1 answer
| a. | The Folk Theorem introduced in the notes assumes that actions are observable. | |
| b. | In a finitely repeated game where T becomes large, different outcomes can be supported as SPNE. | |
| c. | In a finitely repeated game where players become more patient results other than the stage NE become feasible. | |
| d. | In the SPNE of the twice repeated game players play the stage NE in both periods. | |
| e. | Any outcome can be supported as a SPNE when the game is repeated infinitely many times and players are patient enough. |
Solution
A IS true. Without observable actions no SPNE will occur
B is false so it does not apply. This happens quite often in infinitely repeated games. Often new SPNE are reached
D is also right so it does apply. Completely different outcomes may NOT BE possible
E TRUE according to folk theorm
