I have the D2 exam next week, and in past papers I always drop marks on the questions which ask you to plot three lines and solve for the optimum value of p. My D1 knowledge is pretty rusty so could someone please explain how you answer this type of question? I have an image of the type of question I mean, it is part (v) in the image.
D2 OCR game theory/linear programming question Watch
- Thread Starter
- 22-05-2016 15:31
- 24-05-2016 19:50
So after you've written down the three expressions using p and p-1 you need to plot the three lines on a graph. The highest point under all three lines on the graph gives the optimum value of p (highest point where two of the lines cross that is also underneath the other line). When you've found this point equate the two lines that are crossing and solve for p. This is the optimum value. Then substitute that value of p back into one of the expressions to find Rowena's expected payoff.