A Nash equilibrium occurs when:
A) each player has a dominant strategy.
B) each player receives the same final payoff.
C) each player believes it is doing the best it can given the behavior of rivals.
D) there is no dominant strategy for any player.
E) payoffs are independent of the actions taken by rivals.

Question

Quizplus · Accepted Answer

Nash equilibrium occurs when each player believes it is doing the best it can given the behavior of rivals. It does not necessarily involve dominant strategies or equal payoffs, and players' payoffs can be affected by the actions of rivals. Therefore, option C is the correct answer.

A Nash Equilibrium Occurs When