3-player dice gameschalk/3192/sol3.pdf3-player dice game exercise 12 (a): 3-player dice game. each...

3-Player dice game

Exercise 12 (a): 3-player dice game.

Each Player has two choices which we give as 1 (bet one) and 2 (bettwo). Hence the space of strategies is the same as in Example 2.5.

The following table gives the pay-off function for the three players, P1,P2 and P3.

(1, 1, 2) is an equilibrium point.(1, 2, 1) is an equilibrium point.(1, 2, 2) is an equilibrium point.(2, 1, 1) is an equilibrium point.(2, 1, 2) is an equilibrium point.(2, 2, 1) is an equilibrium point.

There are plenty of equilibrium pointsin this game!

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1)

(1, 1, 2)

(1, 2, 1)

(1, 2, 2)

(2, 1, 1)

(2, 1, 2)

(2, 2, 1)

(2, 2, 2)

There are two possible outcomes tothe throw of the dice, 1 and 2.Each of these occurs with probabil-ity 1/2. Hence the expected pay-off forPlayer 1 when the chosen strategy is(1, 1, 1) is

20 = 1.

prob. pay-off prob. pay-off

In this manner we can calculate thevarious expected pay-offs.

(1, 1, 2)is an equilibrium point.(1, 2, 1) is an equilibrium point.(1, 2, 2) is an equilibrium point.(2, 1, 1) is an equilibrium point.(2, 1, 2) is an equilibrium point.(2, 2, 1) is an equilibrium point.

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2)

(1, 2, 1)

(1, 2, 2)

(2, 1, 1)

(2, 1, 2)

(2, 2, 1)

(2, 2, 2)

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1)

(1, 2, 2)

(2, 1, 1)

(2, 1, 2)

(2, 2, 1)

(2, 2, 2)

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

(1, 1, 1) is not an equilibrium pointsince Player 3 can improve her pay-offby switching strategies.

(1, 1, 2) is anequilibrium point.(1, 2, 1) is an equilibrium point.(1, 2, 2) is an equilibrium point.(2, 1, 1) is an equilibrium point.(2, 1, 2) is an equilibrium point.(2, 2, 1) is an equilibrium point.

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

(1, 1, 2) is an equilibrium point.

(1, 2, 1) is an equilibrium point.(1, 2, 2) is an equilibrium point.(2, 1, 1) is an equilibrium point.(2, 1, 2) is an equilibrium point.(2, 2, 1) is an equilibrium point.

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

(1, 1, 2) is an equilibrium point.(1, 2, 1) is an equilibrium point.

(1, 2, 2) is an equilibrium point.(2, 1, 1) is an equilibrium point.(2, 1, 2) is an equilibrium point.(2, 2, 1) is an equilibrium point.

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

(1, 1, 2) is an equilibrium point.(1, 2, 1) is an equilibrium point.(1, 2, 2) is an equilibrium point.

(2, 1, 1) is an equilibrium point.(2, 1, 2) is an equilibrium point.(2, 2, 1) is an equilibrium point.

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

(1, 1, 2) is an equilibrium point.(1, 2, 1) is an equilibrium point.(1, 2, 2) is an equilibrium point.(2, 1, 1) is an equilibrium point.

(2, 1, 2) is an equilibrium point.(2, 2, 1) is an equilibrium point.

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

(1, 1, 2) is an equilibrium point.(1, 2, 1) is an equilibrium point.(1, 2, 2) is an equilibrium point.(2, 1, 1) is an equilibrium point.(2, 1, 2) is an equilibrium point.

(2, 2, 1) is an equilibrium point.

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

(1, 1, 2) is an equilibrium point.(1, 2, 1) is an equilibrium point.(1, 2, 2) is an equilibrium point.(2, 1, 1) is an equilibrium point.(2, 1, 2) is an equilibrium point.(2, 2, 1) is an equilibrium point.(2, 2, 2) is not an equilibrium point.

– p. 1/8

3-Player dice game

P1 P2 P3

(1, 1, 1) 1 1 1

(1, 1, 2) 2 2 5

(1, 2, 1) 2 5 2

(1, 2, 2) 5 2 2

(2, 1, 1) 5 2 2

(2, 1, 2) 2 5 2

(2, 2, 1) 2 2 5

(2, 2, 2) 1 1 1

– p. 1/8

Discussion of equilibria

Exercise 13 (a).

(4,−300) (10, 6)

(8, 8) (5, 4)

The equilibria are

(1, 2)and (2, 1).

Player 1 prefers the former (because itgives him the higher pay-off of 10 over 8)while Player 2 prefers the latter (becauseit gives her the higher pay-off of 8 over 6).

But if Player 2 chooses her strategy 1to aim for her preferred equilibrium pointthen if Player 1 chooses his strategy 1 toachieve his preferred equilibrium point shewill get a pay-off of −300.

It seems therefore much more prudent forher to ‘play it safe’ by choosing her strat-egy 2 and settle on (1, 2).

– p. 2/8

Exercise 13 (a).

(4,−300) (10, 6)

(8, 8) (5, 4)

The equilibria are (1, 2)

and (2, 1).

– p. 2/8

Exercise 13 (a).

(4,−300) (10, 6)

(8, 8) (5, 4)

The equilibria are (1, 2) and (2, 1).

– p. 2/8

Exercise 13 (a).

(4,−300) (10, 6)

(8, 8) (5, 4)

Player 1 prefers the former (because itgives him the higher pay-off of 10 over 8)

while Player 2 prefers the latter (becauseit gives her the higher pay-off of 8 over 6).

– p. 2/8

Exercise 13 (a).

(4,−300) (10, 6)

(8, 8) (5, 4)

– p. 2/8

Exercise 13 (a).

(4,−300) (10, 6)

(8, 8) (5, 4)

– p. 2/8

Exercise 13 (a).

(4,−300) (10, 6)

(8, 8) (5, 4)

– p. 2/8

Checking equilibria

Exercise 14 (a): Checking equilibria.

−3 −3 2

−1 3 −2

3 −1 −2

2 2 −3

Show that the game with the pay-off matrixgiven below has the mixed strategy equilib-rium ((1/2, 0, 0, 1/2), (1/4, 1/4, 1/2)).

We cal-culate the pay-off of playing these two strate-gies against each other. It is −1/2.

By Proposition 3.9 this is indeed an equilib-rium point. Note that in the long run thatmeans that Player 1 will lose 1/2 unit pergame!

– p. 3/8

Checking equilibria

−3 −3 2

−1 3 −2

3 −1 −2

2 2 −3

We calculate the pay-off of playing these twostrategies against each other. It is

4(−3)+

2(−3)

−1/2.

– p. 3/8

Checking equilibria

−3 −3 2

−1 3 −2

3 −1 −2

2 2 −3

We calculate the pay-off of playing these twostrategies against each other. It is −1/2.

If Player 1 chooses his mixed strategy(1/2, 0, 0, 1/2) his pay-offs against Player 2’spure strategies are as follows.

1 2 3(1/2, 0, 0, 1/2) −1/2 −1/2 −1/2

Since no number appearing in this table issmaller than −1/2, changing from the equi-librium point to a pure strategy won’t leavePlayer 2 better off. So this part checks out.

ByProposition 3.9 this is indeed an equilibriumpoint. Note that in the long run that meansthat Player 1 will lose 1/2 unit per game!

– p. 3/8

Checking equilibria

−3 −3 2

−1 3 −2

3 −1 −2

2 2 −3

When Player 2 matches her mixed strategy(1/4, 1/4, 1/2) against Player 1’s pure strate-gies the pay-offs are as follows.

1 2 3 4(1/4, 1/4, 1/2) −1/2 −1/2 −1/2 −1/2

Since no number appearing in this table islarger than −1/2, changing from the equi-librium point to a pure strategy won’t leavePlayer 1 better off. So this part checks outtoo.

By Proposition 3.9 this is indeed an equi-librium point. Note that in the long run thatmeans that Player 1 will lose 1/2 unit pergame!

– p. 3/8

Checking equilibria

−3 −3 2

−1 3 −2

3 −1 −2

2 2 −3

– p. 3/8

Dominance

Exercise 15 (a): Dominance.

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

−2 4

Strategy 1 for Player 2 dominates herstrategy 2 and strategy 2 for Player 1dominates his strategies 1 and 4.The first

strategy for Player 2 dominates the thirdone.This matrix can be solved with themethods for (2×2)-matrices lecture notes.

– p. 4/8

Dominance

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

−2 4

Strategy 1 for Player 2 dominates herstrategy 2

and strategy 2 for Player 1dominates his strategies 1 and 4.The first

– p. 4/8

Dominance

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

−2 4

Strategy 1 for Player 2 dominates herstrategy 2 and strategy 2 for Player 1dominates his strategies 1 and 4.

The first

– p. 4/8

Dominance

−2 4 2

−2 4

Strategy 1 for Player 2 dominates herstrategy 2 and strategy 2 for Player 1dominates his strategies 1 and 4.

The first

– p. 4/8

Dominance

−2 4 2

−2 4

The first strategy for Player 2 dominatesthe third one.

This matrix can be solvedwith the methods for (2 × 2)-matrices lec-ture notes.

– p. 4/8

Dominance

−2 4

The first strategy for Player 2 dominatesthe third one.

This matrix can be solvedwith the methods for (2 × 2)-matrices lec-ture notes.

– p. 4/8

Dominance

−2 4

This matrix can be solved with the meth-ods for (2 × 2)-matrices lecture notes.

– p. 4/8

Dominance

−2 4

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

To find Player 1’s equilibrium point strat-egy we have to find the intersection of thetwo lines given by

y = −6x + 4 and y = 2x + 2.

We get x = 1/4. The value of the gameis the corresponding y-value, 5/2. ForPlayer 2 the intersection is at x = 3/4.

Hence the unique equilibriumpoint of the original game is((0, 3/4, 1/4, 0), (1/4, 0, 3/4, 0)).

– p. 5/8

Dominance

−2 4

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

y = −6x + 4 and y = 2x + 2.

– p. 5/8

Dominance

−2 4

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

y = −6x + 4 and y = 2x + 2.

We set−6x + 4 = 2x + 2,

which is equivalent to

8x = 2 or x =1

– p. 5/8

Dominance

−2 4

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

y = −6x + 4 and y = 2x + 2.

We get x = 1/4. The value of the game isthe corresponding y-value,

−6 ×1

4+ 4 = 5/2.

5/2. For Player 2 the intersection is at x =3/4.

– p. 5/8

Dominance

−2 4

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

y = −6x + 4 and y = 2x + 2.

We get x = 1/4. The value of the gameis the corresponding y-value, 5/2. ForPlayer 2 we have to intersect the two linesgiven by

y = −2x + 4 and y = 6x − 2.

For Player 2 the intersection is at x = 3/4.

– p. 5/8

Dominance

−2 4

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

y = −6x + 4 and y = 2x + 2.

– p. 5/8

Dominance

−2 4

2 4 0 −2

4 8 2 6

−2 0 4 2

−4 −2 −2 0

y = −6x + 4 and y = 2x + 2.

– p. 5/8

Solving matrix games

Exercise 16 (a): Solving matrix games.

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

12 −6

– p. 6/8

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

12 −6

Player 1’s strategy 1 dominates his strat-egy 2.

– p. 6/8

16 14 6 11

0 −2 12 −6

22 −12 6 10

12 −6

– p. 6/8

16 14 6 11

0 −2 12 −6

22 −12 6 10

12 −6

Player 2’s strategy 4 dominates her strat-egy 1.

– p. 6/8

14 6 11

−2 12 −6

−12 6 10

12 −6

– p. 6/8

14 6 11

−2 12 −6

−12 6 10

12 −6

Player 1’s first strategy dominates his thirdone.

– p. 6/8

14 6 11

−2 12 −6

12 −6

– p. 6/8

14 6 11

−2 12 −6

12 −6

Now Player 2’s strategy 3 dominates herstrategy 1.

– p. 6/8

12 −6

– p. 6/8

12 −6

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

y = 6x + 6 and y = −17x + 11.

We get x = 5/23. The value of the game isthe corresponding y-value, 168/23. whichhappens at x = 6/23.

Hence the unique equilibriumpoint of the original game is((18/23, 0, 5/23, 0), (0, 0, 17/23, 6/23)).

– p. 7/8

12 −6

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

y = 6x + 6 and y = −17x + 11.

– p. 7/8

12 −6

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

y = 6x + 6 and y = −17x + 11.

We set

6x + 6 = −17x + 11,

which is equivalent to

23x = 5 or x =5

– p. 7/8

12 −6

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

y = 6x + 6 and y = −17x + 11.

We get x = 5/23. The value of the gameis the corresponding y-value,

23+ 6 = 168/23.

168/23. which happens at x = 6/23.

– p. 7/8

12 −6

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

y = 6x + 6 and y = −17x + 11.

We get x = 5/23. The value of the gameis the corresponding y-value, 168/23. ForPlayer 2 we have to intersect the two linesgiven by

y = 5x + 6 and y = −18x + 12,

which happens at x = 6/23.

– p. 7/8

12 −6

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

y = 6x + 6 and y = −17x + 11.

– p. 7/8

12 −6

16 14 6 11

−14 4 −10 −8

0 −2 12 −6

22 −12 6 10

y = 6x + 6 and y = −17x + 11.

– p. 7/8

Dominance of mixed strategies

Exercise 17 (a): Dominance of mixed strategies.

−1 3 −3

Checking for candidates for elimination wesettle on strategy 1 for Player 2. Theonly candidate for a dominated strategy isPlayer 1’s strategy 1.

– p. 8/8

−1 3 −3

Checking for candidates for elimination wesettle on strategy 1 for Player 2.

Theonly candidate for a dominated strategy isPlayer 1’s strategy 1.

– p. 8/8

−1 3 −3

Checking for candidates for elimination wesettle on strategy 1 for Player 2. We need0 ≤ λ ≤ 1 such that

2 ≥ λ

2 ≥ 3(1 − λ) = 3 − 3λ

−1 ≥3λ − 3(1 − λ) = 6λ − 3

The only candidate for a dominated strategyis Player 1’s strategy 1.

– p. 8/8

−1 3 −3

2 ≥ λ always

2 ≥ 3(1 − λ) = 3 − 3λ

−1 ≥3λ − 3(1 − λ) = 6λ − 3

– p. 8/8

−1 3 −3

2 ≥ λ always

2 ≥ 3(1 − λ) = 3 − 3λ iff λ ≥ 1/3

−1 ≥3λ − 3(1 − λ) = 6λ − 3

– p. 8/8

−1 3 −3

2 ≥ λ always

2 ≥ 3(1 − λ) = 3 − 3λ iff λ ≥ 1/3

−1 ≥3λ − 3(1 − λ) = 6λ − 3 iff λ ≤ 1/3

– p. 8/8

−1 3 −3

2 ≥ λ always

2 ≥ 3(1 − λ) = 3 − 3λ iff λ ≥ 1/3

−1 ≥3λ − 3(1 − λ) = 6λ − 3 iff λ ≤ 1/3

Hence λ = 1/3 will do.

The only candidatefor a dominated strategy is Player 1’s strat-egy 1.

– p. 8/8

3 −3

– p. 8/8

3 −3

– p. 8/8

3 −3

The only candidate for a dominated strategyis Player 1’s strategy 1. We have to find0 ≤ λ ≤ 1 such that

1 ≤ 3(1 − λ) = 3 − 3λ

0 ≤3λ − 3(1 − λ) = 6λ − 3

– p. 8/8

3 −3

1 ≤ 3(1 − λ) = 3 − 3λ iff λ ≤ 2/3

0 ≤3λ − 3(1 − λ) = 6λ − 3

– p. 8/8

3 −3

1 ≤ 3(1 − λ) = 3 − 3λ iff λ ≤ 2/3

0 ≤3λ − 3(1 − λ) = 6λ − 3 iff λ ≥ 1/2

– p. 8/8

3 −3

1 ≤3(1 − λ) = 3 − 3λ iff λ ≤ 2/3

0 ≤3λ − 3(1 − λ) = 6λ − 3 iff λ ≥ 1/2

There are plenty of λs (from 1/2 to 2/3) tochoose from.

– p. 8/8

3 −3

We cannot reduce this matrix any further, butwe know how to solve (2 × 2)-matrices.

– p. 8/8

3-player dice gameschalk/3192/sol3.pdf3-player dice game exercise 12 (a): 3-player dice game. each...

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