Solving for dominant strategies and the Nash equilibrium Suppose Lorenzo and Neha are playing a game in which both must simultaneously choose the action Left or Right. The payoff matrix that follows shows the payoff each person will earn as a function of both of their choices. For example, the lower-right cell shows that if Lorenzo chooses Right and Neha chooses Right, Lorenzo will receive a payoff of 6 and Neha will receive a payoff of 5 Neha
Left Right
Lorenzo Left 8,4 4,5
Right 5,4 6,5
1. The only dominant strategy in this game is for (Neha/Lorenzo) to choose (Right/Left)
2. The outcome reflecting the unique Nash equilibrium in this game is as follows: Lorenzo chooses (Right/Left) and Neha chooses (Right/Left) .