Game Theory

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Title: Game Theory

Essay Details:

Subject: Business

Author:

Date: July 6, 2015

Level: University

Grade: B

Length: 6 / 1602

Essay text:

If neither confesses, they are convicted of a minor crime and are sentenced to 2 months. If both confess, they spend 12 months in jail. However, if one confesses and the other does not, the confessor is released immediately but the other is sentenced to 18 months in jail ? 12 for the crime and 6 for obstructing justice. Peter (deny) Peter (confess) John (deny) 2, 2 18, 0 John (confess) 0, 18 12, 12 NE (NE ? Nash Equilibrium 2) With self-interest, both have incentive to confess. For example, to John, if Peter denies, John will be free immediately, otherwise his time in jail will be reduced from 18 months to 12 months...

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