Submitted By herman1072

Words 2613

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Words 2613

Pages 11

Content 1. Introduction -------------------------------------------------------------------- P.2 2. Main Models of Game Theory ---------------------------------------------- p.3-4 3. Nash Equilibrium ------------------------------------------------------------- p.5 4. Dominant Strategy ----------------------------------------------------------- p.5 5. Prisoners’ Dilemma ---------------------------------------------------------- p.5-6 6. Daily Example of Competition of Supermarkets ------------------------ p.7-8 7. Daily Example of Competition of Mobile Market ---------------------- p.9-10 8. Daily Example of Penalty Kick in Football Match --------------------- p.11-12 9. Conclusion ------------------------------------------------------------------- p.13 10. Reference -------------------------------------------------------------------- p.14-15

Introduction

Game theory is the study of how people behave in strategic situations. Game theory concerns situations in which multiple players make strategically interdependent decisions. The term interdependent means that one person’s behavior affects another person’s well-being. We can make use of game theory on different aspects such as economics, political science and even our daily life. For example, whether TV stations leads to enlarge the market shares on program production usually depends on the subsequent moves of the opponent.

Game theory arises from the analysis of competitive scenarios, the problems are called games and the participants are called player. It can tell us how we should behave in a game in order to produce optimal results and it can be as a theory that describes how people actually behave in a game. There are some elements for analyzing and predicting how humans behave in strategic…...

...Game Theory On Gallerie Apex Vs Bata Submitted to Abu Reza Mohammad Muzareba Lecturer Department of Marketing University of Dhaka Submitted by Group: Gamers Section: A Batch: 17th Department of Marketing University of Dhaka Submission date: 21th April, 2012 AbuReza Mohammad Muzareba Lecturer University of Dhaka Dept. of Marketing Subject: Letter of transmittal Dear Sir, Enclosed is a report on the Game theory Between Gallerie Apex and Bata. This report is about the internal and external business strategies of the pioneer footwear company Gallerie Apex and Bata. We were assigned to submit this report in 21th April 2012 to be submitted as a term paper for our Business Mathematics 2 course in the 3rd semester of our BBA program, from the department of Marketing of University of Dhaka. We have completed it whilst trying to meet all its broad and specific objectives within the allotted time. We are submitting the report to you only, as our course instructor and will be keeping a copy for any future references. We have organized our findings about the business strategies of the above mentioned trading companies. This paper includes an introduction to the company in focus, in terms of their business strategies and an analysis of those processes with some possible recommendations. It has been completed with a conclusion. At the end of the report...

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...Game Theory Themes 1. Introduction to Game Theory 2. Sequential Games 3. Simultaneous Games 4. Conclusion Introduction to Game Theory Game theory is the branch of decision theory concerned with interdependent decisions. The problems of interest involve multiple participants, each of whom has individual objectives related to a common system or shared resources. Because game theory arose from the analysis of competitive scenarios, the problems are called games and the participants are called players. But these techniques apply to more than just sport, and are not even limited to competitive situations. In short, game theory deals with any problem in which each player’s strategy depends on what the other players do. Situations involving interdependent decisions arise frequently, in all walks of life. A few examples in which game theory could come in handy include: ● Friends choosing where to go have dinner ● Parents trying to get children to behave ● Commuters deciding how to go to work ● Businesses competing in a market ● Diplomats negotiating a treaty ● Gamblers betting in a card game All of these situations call for strategic thinking – making use of available information to devise the best plan to achieve one’s objectives. Perhaps you are already familiar with assessing costs and benefits in order to make informed decisions between several options. Game theory simply extends this concept to interdependent decisions, in which the options being evaluated are functions of...

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...21/01/09 Start with a brief timeline, including when applications to different areas were first used. Game Theory (i) Game Theory Introduction We begin with a simple, informal example of a game. Rousseau, in his Discourse on the Origin and basis of equality among men, comments: “If a group of hunters set out to take a stag, they are fully aware that they would all have to remain faithfully at their posts in order to succeed, but if a hare happens to pass near one of them, there can be no doubt that he pursued it without qualm, and that once he had caught his prey, he cared very little whether or not he had made his companions miss theirs” To make this into a game, we need to fill out a few details. Suppose that there are only two hunters, and that they must decide simultaneously whether to hunt for a stag or for hare. Each player has a choice between two strategies: (hunt stag, hunt hare). If both hunt stag, each gets half a stag If both hunt hare, each gets one hare If one hunts for hare while the other tries to take a stag, the former will catch a hare and the latter will catch nothing. If we suppose that the utility of catching a stag is 4 and for a hare is 1, then the payoff matrix for the players can be summarised as follows: Stag Hare (2,2) (0,1) (1,0) (1,1) Game theory is concerned with what outcomes arise in equilibrium. An equilibrium outcome is one which......

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...MOULIN Pierre Under The direction of Per Axelson 3 novembre 2013 ! ! ! ! ! An introduction to « Game Theory », and its applications. ! ! ! ! IBMEC - EM Strasbourg Business School ! ! ! ! ! ! ! GAME THEORY "1 SUMMARY ! ! ! ! ! A brief introduction to the origins of the Game Theory……………..…3 What is a game ?………………………………………………………….……4 What is the purpose of a game ?……………………………………….….….….4 What deﬁnes a game ?…………………………………………….…….…….….4 Typology of the actual know games………………………….……….……….…4 How can we represent a game ?……………………….………….………….…..5 Strategies and actions in a game…………………….………………….…..6 Dominant/Dominated Strategies…………………….……………………….….6 Mixed Strategies……………………………………………………………….…6 Notion of The Pareto Optimum…………………………………………………7 A complete, concrete (and classic) example : The Prisoner’s Dilemma………….7 Commitment & Credibility………………………………………………………8 A concrete example of a commitment problem…………………………………9 Conclusion…………………………………………………………………….10 Sources………………………………………………………….…………..…11 ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! GAME THEORY "2 A/ A brief introduction to the origins of the Game Theory… ! What is Game Theory ? It is the study of mathematical models of conﬂict and cooperation between intelligent rational decision-makers. An alternative term would probably be Interactive Decision Theory. Even if this concept is, basically, pure economics, today we can see it in various range of application, from political science to......

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...Game Theory∗ Theodore L. Turocy Texas A&M University Bernhard von Stengel London School of Economics CDAM Research Report LSE-CDAM-2001-09 October 8, 2001 Contents 1 What is game theory? 2 Deﬁnitions of games 3 Dominance 4 Nash equilibrium 5 Mixed strategies 6 Extensive games with perfect information 7 Extensive games with imperfect information 8 Zero-sum games and computation 9 Bidding in auctions 10 Further reading 4 6 8 12 17 22 29 33 34 38 This is the draft of an introductory survey of game theory, prepared for the Encyclopedia of Information Systems, Academic Press, to appear in 2002. ∗ 1 Glossary Backward induction Backward induction is a technique to solve a game of perfect information. It ﬁrst considers the moves that are the last in the game, and determines the best move for the player in each case. Then, taking these as given future actions, it proceeds backwards in time, again determining the best move for the respective player, until the beginning of the game is reached. Common knowledge A fact is common knowledge if all players know it, and know that they all know it, and so on. The structure of the game is often assumed to be common knowledge among the players. Dominating strategy A strategy dominates another strategy of a player if it always gives a better payoff to that player, regardless of what the other players are doing. It weakly dominates the other strategy if it is always at least as good. Extensive game An extensive game (or......

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...25, 2014 Game Theory “Game theory is the study of strategic interaction among rational players in an interactive setting” (Stevens, Lecture 1). Elements of a game consist of common knowledge, the players, strategies and payoffs. Every other Friday night my wife and I play cards at our friend’s house and it generally gets more intense as the game and the drinks progress. We mainly play a card game called spades and we play as partners. Common knowledge in this game is every player knows that in order to win you have to bid the correct number of books, meaning you have to guess how many rounds you and your partner can win based off what cards you are holding and what you think the other players are holding in their hands. Each player also is assumed to be an experienced player unless otherwise stated and even if they are it’s easier to guess how the hand will play out. In this card game there is not strictly a pure strategy at play, meaning it doesn’t not involve an act of randomness but a game of mixed strategy. Mixed strategy means using a pure strategy with acts of randomness. I have an idea what the other players will do when it is their turn in the card game but sometimes to force their hand, it is necessary to randomly sacrifice one of your cards to make them display their higher ranked cards. The payoff to a player reflects what that player cares about, not what another player thinks they should care about. Being rational means I make my decisions in a way......

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...GAME THEORY & ASYMMETRIC INFORMATION LITERATURE REVIEW NATHALIA PALOMINO ID# 0501605 MARCH 1, 2014. FACILITATOR: SHELLEY WHITTLE Introduction This paper will firstly address game theory, Prisoners Dilemma which is a very prominent game and Bargaining. Asymmetric Information is also discussed along with a few examples of how asymmetric information relates to the business environment. The writer gives the reader a basic understanding of game theory and asymmetric information uses in a logical manner. As many opinions are combined to critically analyse the aforementioned. Game Theory A definition of Game Theory or something that appears to be a definition may be applied as such: An analytical or mathematical approach of examining strategic interaction when dealing with competitive situations in business decisions. As Keat, Young & Stephen (2014) did not give a clear definition of Game Theory. This definition stated business decision however, Martin (1978) stated that Game theory has proved useful in only war and economic. He states, “I see that at least three ways in which game theory has proved ‘useful’. First, it has led to practical advice on tactical decision-making in certain well defined situations, especially in military areas involving missile tracking and similar task (where the theory of differential games has led to results equivalent to control theory). Second, it has provided an occupation and amusement for thousands of government......

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...Game theory is a concept of decision making that considers more elements beyond just benefits minus costs. Specifically, it includes the interaction between participants. In economics, the theory attempts to predict the participants’ optimal decisions. It has found a core place in economic decision-making and policy-making for its inherent ability to predict reactions in resource allocation, business negotiation, and other economic aspects. Game theory is mostly associated with decision-theory and other contexts such as cooperation and negotiations. From its definition, it is evident that the game theory is largely used in the study of the human decision making processes. In psychology, its equivalent is known as the theory of social situations. In economics, however, game theory tends to focus on sets of outcomes known as equilibrium that represent the most rational solutions to each situation. Game theory emanates from the complexity of human interactions; thus, in a situation where an individual is dealing with an inanimate object such as a tree, he or she does not expect the tree to fight back or respond (Leyton-Brown and Shoham 51). The environment can also be considered neutral to what is done to the tree, at least in direct and rational response. In human interactions, however, each action by an actor emanates from a situation and elicits a response. Each actor must thus recognize how his of her interaction with other rational actors works so as to foster cooperation...

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...“Planning and Playing a Game” Objectives: * Learn how individuals contribute to teamwork. * Experience some of the features of group work and teamwork. * Understand what managers and organizational developers do to transform groups into teams. * Articulate the tangible benefits (both quantitative and qualitative) of high-performing teams. * Finish with an interest in learning more about these concepts and techniques to apply what you learn. Background: In game theory, there are non-cooperative and cooperative games. A non-cooperative zero-sum game has a definite winner and loser. For one to win, one must lose. A cooperative game is where everyone who plays is better off for having played than not having played the game. That is not to say that everyone is equally well off, but simply better off than they were before playing. Hence, even in a cooperative game, some people will likely benefit more than others. To understand why individuals make the decisions they do in a game it is important to consider the personality of the player. Personality is a term used to describe a great many feelings and behaviors. Literally hundreds of personality dimensions or traits have been identified by psychologist over the last 100 years. However, within the past 25 years or so, a consensus has emerged that, for the most part, the human personality can be described by five dimensions or factors. The Big Five personality dimensions include: extroversion,......

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...Game Theory Background An Illustrative Example Course Structure Introduction to Game Theory Econ 414 Jeﬀ Borowitz Summer I 2010 Jeﬀ Borowitz Introduction to Game Theory 1 / 18 Game Theory Background An Illustrative Example Course Structure Rational Choice What is Game Theory? Game Theory is really “Multi-Party Decision Theory” Outside of game theory, we think of just one actor (ﬁrms maximizing proﬁts, workers deciding how much to work, etc.) Decisions involving many parties are very relevant to economics Oligopoly Public Goods Working together on a team project Jeﬀ Borowitz Introduction to Game Theory 2 / 18 Game Theory Background An Illustrative Example Course Structure Rational Choice What is a game? Formally A game consists of Players The actions that the players can take How much each player values each potential outcome What each player knows Deﬁnition (A Game) A game Γ = (S, U) is a list of possible actions by each player S = (S1 , S2 , . . . , Sn ), and a list of payoﬀ functions for each player under all possible combinations of actions by each other player U = (u1 (S), u2 (S), . . . , un (S)) Jeﬀ Borowitz Introduction to Game Theory 3 / 18 Game Theory Background An Illustrative Example Course Structure Rational Choice What is a game? Informally Games Fantasy Football (drafting, picking line-ups depend on what others do) Rock-Paper-Scissors Risk Not Games Football (depends on skill,......

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...Through visionary thought and understanding, a creative strategy increases the outcome of success in a given situation or variable. In many cases, strategy is understood as a plan that chooses an individual’s future possible position. Speaking with respect to Game Theory within the Healthcare field, there are many ways to move forward with creating this ideal insightful approach. Learning through class discussions, it’s clear the topic of the discussion with Game Theory is very evolved, diverse, and dynamic with all different observations. All games share an interdependence meaning the result for each individual is dependent on the option they primarily choose. For myself, this is definitely considered an everyday normalcy working in the Healthcare Industry. Whether Game Theory is applied in all of society is only understood through the participants as all situations are different and unique, but all equally share the mindset of increasing their individual outcome of achievement. The analysis of Game Theory within Healthcare is spread across an increasingly strategy-prone competitive market. Governmental changes alone within healthcare laws create challenges for decision makers to compete within this highly-regulated domain. Creating governmental regulation lessens efficiency for providers who serve society to collaboratively work together, and in addition, diminishes their likelihood of optimal standing within the environment. Turning the hand in reference to my current......

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...A game is any situation of conflict with at least two players (it may be a person, company). Each side chooses some kind of behavior (strategy) to get the best payoff. Game theory is a way to study conflicts and strategies used to get best results. The decision process is made without full knowledge and that’s what drives people engage into game to strategize to get as good output as possible- perfectly to win everything or at least to lose as little as possible. Game theory as a mix of psychology, mathematics, logic and other academics areas can be useful in several ‘real life’ situations, including negotiations and business. It can be observed in an oligopoly market, when two companies offering a very similar product (for example gas) must find a way to win over their competitors. One can notice parallels in a situation of those companies and classical example of the game theory “prisoner dilemma”. Game theory may also be used in auctions, mergers and acquisitions, bargaining, real estate negotiations, salary negotiations and so on. The most common application of game theory in real life is setting price. Each company wants to set price as high as possible to maximize profit but also wants to win market share as big as possible. Companies can all set the same price for their products and split the profit between themselves or one could try and forecast an advantageous set of lower prices and basically win since their higher market share even at their lower prices......

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...notes Game Theory Game Theory can be regarded as a multi-agent decision problem. Which means there are many people contending for limited rewards/payoffs. They have to make certain moves on which their payoff depends. These people have to follow certain rules while making these moves. Each player is suposed to behave rationally. Rationality: In the language of Game Theory rationality implies that each player tries to maximize his/her payoff irrespective to what other players are doing. In essence each player has to decide a set of moves which are in accordance with the rules of the game and which maximize his/her rewards. Game Theory can be classified in two branches 1. Non co-operative game theory : In this case the players work independently without assuming anything about what other players are doing. 2. Co-operative game theory: Here players may co-operate with one another. Game Theory has found applications in Economic, Evolutionary Biology, Sociology, Political Science etc, now Its finding applcations in Computer Science. What is a game? A game has the following 1. 2. 3. 4. 5. Set of players Set of rules Set of Strategies Set of Outcomes. Pay off D = { Pi | 1 <= i <= n} R Si for each player Pi O ui (o) for each player i and for each outcome o e O Example 1{Coin Matching Game} Coin Matching Game : Two players choose independently either Head or Tail and report it to a central authority. If both choose the same side of the coin , player 1 wins, otherwise 2 wins. A game......

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...Managerial Economics 2010 1. A. Design a simple two-company game that illustrates why it might have been in economic interests of the cigarette companies to support the ban. In designing the game, assume that there is no regulation and that the two firms simultaneously choose between advertising and not advertising. Display your hypothetical payoffs in strategic form (see Figure 9.1) and highlight the Nash equilibrium. Explain the intuition for why the firms in your example would favor regulation to ban advertising. Winston |Advertise |Not Advertise | |fff | | | | | |100/100 |160/60 | | | | | | | | | | |160/60 |150/150 | Profits – Advertising Cost from TV (In millions) Advertise Tareyton Not Advertise During the 1960’s, numerous reports started to surface connecting cancer to smoking...

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...Game Theory Game A game is a formal description of a strategic situation. Game Theory Game theory is the formal study of decision-making where several players must make choices that potentially affect the interests of the other players. Mixed Strategy A mixed strategy is an active randomization, with given probabilities, that determines the player’s decision. As a special case, a mixed strategy can be the deterministic choice of one of the given pure strategies. Nash Equilibrium A Nash equilibrium, also called strategic equilibrium, is a list of strategies, one for each player, which has the property that no player can unilaterally change his strategy and get a better payoff. Pay-Off A payoff is a number, also called utility, that reflects the desirability of an outcome to a player, for whatever reason. When the outcome is random, payoffs are usually weighted with their probabilities. The expected payoff incorporates the player’s attitude towards risk. Perfect information A game has perfect information when at any point in time only one player makes a move, and knows all the actions that have been made until then. Player A player is an agent who makes decisions in a game. Rationality A player is said to be rational if he seeks to play in a manner which maximizes his own payoff. It is often assumed that the rationality of all players is common knowledge. Strategic form A game in strategic form, also called normal form, is a compact representation of a......

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