Margaret and Bethany have a lemonade stand for one week each summer.
1 answer:
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Answer:
Step-by-step explanation:
a) The game tree for k = 5 has been drawn in the uploaded picture below where C stands for continuing and S stands for stopping:
b) Say we were to use backward induction we can clearly observe that stopping is optimal decision for each player in every round. Starting from last round, if player 1 stops he gets $3 otherwise zero if continues. Hence strategy S is optimal there.
Given this, player 2’s payoff to C is $3, while stopping yields $4, so second player will also chooses to stop. To which, player 1’s payoff in k = 3 from C is $1 and her payoff from S is $2, so she stops.
Given that, player 2 would stop in k = 2, which means that player 1 would stop also in k = 1.
The sub game perfect equilibrium is therefore the profile of strategies where both players always stop: (S, S, S) for player 1, and (S, S) for player 2.
c) Irrespective of whether both players would be better off if they could play the game for several rounds, neither can credibly commit to not stopping when given a chance, and so they both end up with small payoffs.
i hope this helps, cheers
<h2>Answer</h2>
Cost of lectures = $7.33 per hour
<h2>Explanation</h2>Let the cost of the exam hours
Let be the cost of the workshop hours
Let be the cost of the lecture hours.
We know from our problem that exam hours cost twice as much as workshop, so:
equation (1)
We also know that workshop hours cost twice as much as lecture hours, so:
equation (2)
Finally, we also know that 3hr exams 24hr workshops and 12hr lectures cost $528, so:
equation (1)
Now, lets find the value of :
Step 1. Solve for in equation (3)
equation (4)
Step 2. Replace equation (1) in equation (4) and simplify
equation (5)
Step 3. Replace equation (2) in equation (5) and solve for
Cost of lectures = $7.33 per hour