Microeconomic Theory 2

3 Credits

Introduces game theory, public goods and externalities, and adverse selection and moral hazard. Applies pure-strategy and mixed-strategy Nash Equilibria solution concepts to solve simultaneous-play games. Develops Bayesian Nash Equilibria solution concepts for dynamic games. Solves monopolists’ profit-maximization problem. Examines other inefficiencies stemming from public goods, externalities, and information asymmetries.