Now, let's ask what happens when the parties play a game like the one in Figure 1,
Figure 1. The Electoral Reform Game-Example 1
except that the benefit to the large party of having disproportional rules is much less, and the penalties to the smaller party from disproportional electoral rules are lower. This might be because the smaller party has been attracting a larger electorate, whereas the large party has been losing voters. This new situation is modeled in Figure 3 below. Using Figure 3, answer the following questions.
Figure 3. The Electoral Reform Game-Example 2

-What strategy combination(s) form(s) a Nash equilibrium in the above game? Hint: use the form (Large strategy; Small strategy).

Question

Now, let's ask what happens when the parties play a game like the one in Figure 1, 
Figure 1. The Electoral Reform Game-Example 1
  except that the benefit to the large party of having disproportional rules is much less, and the penalties to the smaller party from disproportional electoral rules are lower. This might be because the smaller party has been attracting a larger electorate, whereas the large party has been losing voters. This new situation is modeled in Figure 3 below. Using Figure 3, answer the following questions.
Figure 3. The Electoral Reform Game-Example 2
 
-What strategy combination(s) form(s) a Nash equilibrium in the above game? Hint: use the form (Large strategy; Small strategy).

Quizplus · Accepted Answer

For; For is a Nash equilibrium because neither player can improve their payoff by unilaterally changing their strategy.

Now, Let's Ask What Happens When the Parties Play a Game