By Rohith-Raj Dhinakaran Game Theory, as described by Steve Levitt, delves into “strategic interactions between a small number of adversaries (2 to 3 competitors)” . It's a fascinating concept ranging from every situation like “holding the door open for someone” all the way to significant global problems such as “nuclear weapon conflicts between the USA and the Soviet Union in the late 1940’s”. I will discuss the rudiments associated with this discombobulating idea and perhaps help you understand how pertinent this is to the real world. Case 1: Static Game Static Game: This is a game that happens only once and all decisions are made simultaneously. The most common/simple game which we relate to game theory is the “Prisoner’s Dilemma”. Explanation of the Game: The “Prisoner's Dilemma” is a scenario which involves two prisoners who each have two options: stay silent or betray the other person. If both prisoners decide to stay silent, they will each serve one month in prison. I...
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