How game theory can be used to model oligopolistic markets

How game theory can be used to model oligopolistic markets

Question 1:
Suppose that graduating from a university only serves as a signal of high ability (and is not useful in any other way) and that only high-ability individuals can graduate from university. The costs of a university education are denoted by

c. Furthermore, the productivity of low-ability workers is £20,000 while the productivity of high-ability
workers are £80,000.

Firms pay wages according to the (expected) productivity of their workers. The share of high-ability individuals among the population is θ, the share of low-ability individuals is 1 − θ.
a) What is the difference between a pooling equilibrium and a separating equilibrium? (10 marks)
b) Under which conditions do
(i) a separating equilibrium exists, and
(ii) a pooling equilibrium exist?
Explain the conditions carefully. What are the wages in these equilibria? (60 marks)
c) Specify the parameters c and θ such that (i) a separating equilibrium exists and (ii) high-ability individuals are better off in this separating equilibrium than in a hypothetical situation in which there is no university. (30 marks)

Question 2:
Explain how game theory can be used to model oligopolistic markets, illustrating your argument with a game that takes the form of a prisoner’s dilemma. (100 marks)
Word limit: 3000 words in total. Please provide a word count at the end of each question as well as an overall word count at the end of your essay.
Word limit includes any text in the essay (e.g. quotations, in-text references, and footnotes). Word limit excludes title of the question/ essay, equations, tables and their headings, diagrams and their headings, appendices, and bibliography.
Note on the use of Appendices:

The post How game theory can be used to model oligopolistic markets first appeared on COMPLIANT PAPERS.

GET HOMEWORK HELP HERE ONLINE!

Pages (550 words)
Approximate price: -

High Quality Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level or professional level, and we will assign a writer who has a respective degree.

Experienced Writers

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document.

Timely Delivery

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension.A 100% refund is guaranteed.

100% Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text.

Tutorpro support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

Calculate the price of your order

Total price:
\$0.00

How it works?

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Tutorpro Homework Help Services

At Tutorpro, we have top rated masters and PhD writers who will help you tacke that homework and score A+ grade. Tutorpro services covers all levels of education : high school, college, university undergraduate, masters and PhD academic level.

Essay Writing

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.