Suppose that,in a sequential game,the first player chooses the strategy with the highest payoff,taking into account an optimal response from the second player.The outcome that results is
A) a Nash equilibrium.
B) Pareto optimal.
C) a Prisoners' Dilemma.
D) a Stackelberg equilibrium.

Question

Quizplus · Accepted Answer

A sequential game with the first player choosing the strategy with the highest payoff, taking into account an optimal response from the second player, is a Stackelberg equilibrium. This is because the first player is the leader in the game, choosing their strategy before the second player, who is the follower. Therefore, the first player has the advantage of knowing the second player's optimal response and can choose their strategy accordingly to maximize their payoff. This equilibrium is named after Heinrich von Stackelberg, who first introduced the concept in his 1934 book, "Market Structure and Equilibrium."

Suppose That,in a Sequential Game,the First Player Chooses the Strategy