Chapter 7 Game Theory and the Tools of Strategic Business Analysis.

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Chapter 7

Game Theory and theTools of StrategicBusiness Analysis

Figure 7.1(a) Game Tree Diagram for a Game of Perfect Information

Figure 7.1(b) Game Tree Diagram for a Game of Perfect Information

Figure 7.2 Extensive Form of the Game of Matching Pennies

Figure 7.3 The “Gift of the Magi” Game

Figure 7.4 The Isaac-Abraham Game

Figure 7.5 Extensive Form of the Game Played in the Schotter, Weigelt, and Wilson Experiment

Figure 7.6(a) Choices in the First Period

Figure 7.6(b) Choices in the First Period

Figure 7.7 Credible Threats in the Extensive Form of a Game

Figure 7.8 Backward Induction

Figure 7.9 Uniform Probability Distribution Defined over the Interval [0,200]

Figure 7.10 Expected Value of a Wage Greater Than Reservation Wage (w*) over Interval [0, 200] Is Equal

to (w* + 200)/2

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