📚 Learning Guide
Nash Equilibrium in Game Theory
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In a Nash Equilibrium, if one player unilaterally changes their strategy, it is possible that their payoff will increase, indicating that the original equilibrium was not stable.

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A

True

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False

Understanding the Answer

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Answer

A Nash Equilibrium is a situation in a game where no player can gain a better outcome by changing their strategy while the other players keep their strategies the same. This means that each player's strategy is the best response to the strategies of the others. However, if one player decides to change their strategy and finds that their payoff increases, it shows that the original situation was not stable. For example, imagine two friends deciding whether to go to a movie or a concert. If one friend switches from the movie to the concert and ends up happier, it means the initial choice was not the best for everyone, indicating the need for a new equilibrium.

Detailed Explanation

In a Nash Equilibrium, if a player changes their strategy and gets a better outcome, it shows the original situation wasn't stable. Other options are incorrect because This answer suggests that changing a strategy always leads to a better outcome.

Key Concepts

Nash Equilibrium
Interdependence of Strategies
Dominant Strategy
Topic

Nash Equilibrium in Game Theory

Difficulty

medium level question

Cognitive Level

understand

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