Suppose the production game depicted in the above payoff matrix is a sequential-move game.Identify the strategy leading to a first-mover advantage for player 1.
A)Player 1 moves first and plays High Q.Observing player 1's move player 2's best response is to play Low Q.
B)Player 1 moves first and plays Low Q.Observing player 1's move player 2's best response is to play Low Q.
C)Player 1 moves first and plays High Q.Observing player 1's move player 2's best response is to play High Q.
D)Player 1 moves first and plays Low Q.Observing player 1's move player 2's best response is to play High Q.

Question

Quizplus · Accepted Answer

In a sequential-move game, the first-mover advantage goes to the player who can choose the optimal strategy before the other player. In this game, if player 1 plays High Q, player 2's best response will be to play Low Q since that will yield a higher payoff than playing High Q. If player 1 plays Low Q, player 2's best response will still be to play Low Q. Therefore, player 1 has a first-mover advantage by playing High Q.

Suppose the Production Game Depicted in the Above Payoff Matrix