Answer:
The only dominant strategy in this game is for <u>NICK</u> to choose <u>RIGHT</u>. The outcome reflecting the unique Nash equilibrium in this game is as follows: Nick chooses <u>RIGHT</u> and Rosa chooses <u>RIGHT</u>.
Explanation:
ROSA
left right
4 / 6 /
left 3 4
NICK
right 6 / 7 /
7 6
Rosa does not have a dominant strategy since both expected payoffs are equal:
- if she chooses left, her expected payoff = 3 + 7 = 10
- if she chooses right, her expected payoff = 4 + 6 = 10
Nick has a dominant strategy, if he chooses right, his expected payoff will be higher:
- if he chooses left, his expected payoff = 4 +6 = 10
- if he chooses right, his expected payoff = 6 + 7 = 13
The only possible Nash equilibrium exists if both Rosa and Nick choose right, so that their strategies are the same, resulting in Rosa earning 6 and Nick 7.
