Changes

Jump to navigation Jump to search

Nash equilibrium (view source)

Revision as of 23:41, April 13, 2007

991 bytes added ,  23:41, April 13, 2007
first attempt at a difficult concept to teach and explain; help welcome
The Nash equilibrium was developed by [[John Nash]] to describe situations when several people or companies have benefits that depend on the decisions of rival. The Nash equilibrium predicts the choices those people or companies will make to maximize their individual benefits.

The Nash equilibrium is the set of decisions whereby no single individual can improve his benefit if everyone else's decision remains unchanged. That is an "equilibrium" because no one, acting alone, would have any reason to change it.

In economics, the Nash equilibrium describes pricing decisions by an oligopoly. The set of selling prices will be such that no seller can benefit by changing his price while the other sellers keep their prices unchanged. If the cost structures are the same for each seller in an oligopoly, then the Nash equilibrium is where the price equals the marginal cost, or P=MC.

In the [[prisoner's dilemma]], the Nash equilibrium is where both defendants confess to their crime.
Aschlafly
Anthony, Irenaeus, Siteadmin, Bureaucrats, Check users, nsAm_Govt_101RO, nsAm_Govt_101RW, nsAm_Govt_101_ta, nsJudgesRO, nsJudgesRW, nsJudges_talkRO, nsJudges_talkRW, nsTeam2RO, nsTeam2RW, nsTeam2_talkRO, nsTeam2_talkRW, oversight, Administrators
125,910

edits

Retrieved from "https://www.conservapedia.com/Special:MobileDiff/105482"

Navigation menu