Posted: November 6th, 2015

Economics

Economics

Wile E. Coyote is, as usual, attempting to catch and eat Roadrunner. He knows the general area that Roadrunner will be travelling through this evening, but he’s not sure which route (Canyon St or Desert Blvd) Roadrunner will take. Wile E. only has enough dynamite to booby trap one of the roads and he must have his trap in place before Roadrunner starts out. Roadrunner, of course, knows that Wile E. is out there and he knows that one of his routes will be potentially hazardous, but he doesn’t know which. Roadrunner can’t take any other route and, due to contractual obligations with the Cartoon Network, he can’t cancel his journey.

A. Draw the normal-form version of the game described above.

B. Defend your choices of utility numbers for the two players.

C. Write out each player’s best response to each of the other player’s strategies.

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