Playing the equilibrium of a one-stage game over and over again when the one-stage game is repeated is
A) Always a Nash equilibrium
B) Dominated in some cases
C) Weakly dominated in some cases
D) Weakly dominated in all cases

Question

Quizplus · Accepted Answer

Playing the equilibrium of a one-stage game over and over again when the one-stage game is repeated results in an infinitely repeated game. In an infinitely repeated game, playing the Nash equilibrium each time is a subgame perfect equilibrium, meaning it is a rational choice for each player in each round of the game. Therefore, playing the equilibrium of a one-stage game over and over again when the one-stage game is repeated is always a Nash equilibrium in an infinitely repeated game.

Playing the Equilibrium of a One-Stage Game Over and Over