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Chess is one of the most well-known and frequently
played strategy games.
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Strategy game
A strategy game or strategic game is a game,
not necessarily played for fun, in which theplayers' autonomous decision-making skills
have a high significance in determining the
outcome. Almost all strategy games require
internal decision tree style thinking, andtypically very high situational awareness.
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Basic Concepts
The term "strategy" comes ultimately from
Greek, !#$%&$ or strategia( meaninggeneralship. )t differs from "tactics" in that it
refers to the general scheme of things,
whereas "tactics" refers to organi*ation and
e+ecution.
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Basic Concepts
All games have three asic elements
/layers 0trategies
/ayoffs
/layers can make inding agreements in
cooperativegames, ut can not innoncooperativegames, which are studied in
this chapter.
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Payers
A player is a decision maker and can e
anything from individuals to entire nations. /layers have the aility to choose among a
set of possile actions.
Games are often characteri*ed y the fi+ednumer of players.
Generally, the specific identity of a play is not
important to the game.
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Strategies
A strategy is a course of action availale to a
player. 0trategies may e simple or comple+.
)n noncooperative games each player is
uncertain aout what the other will do since
players can not reach agreements among
themselves.
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Payo##s
/ayoffs are the final returns to the players at
the conclusion of the game. /ayoffs are usually measure in utility although
sometimes measure monetarily.
)n general, players are ale to rank the payoffs
from most preferred to least preferred.
/layers seek the highest payoff availale.
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&'(ii)ri(m Concepts
)n the theory of markets an equilirium
occurred when all parties to the market had noincentive to change his or her ehavior.
1hen strategies are chosen, an equilirium
would also provide no incentives for the
players to alter their ehavior further. The most frequently used equilirium concept
is a Nash e'(ii)ri(m*
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Nash &'(ii)ri(m
A Nash e'(ii)ri(mis a pair of strategies
a2,2( in a two-player game such that a2 is anoptimal strategy for A against 2 and 2 is an
optimal strategy for 3 against A2. /layers can not enefit from knowing the equilirium
strategy of their opponents.4ot every game has a 4ash equilirium, and
some games may have several.
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+n ,(strative +dvertising Game
Two firms A and 3( must decide how much to
spend on advertising 5ach firm may adopt either a higher 6( udget
or a low 7( udget.
The game is shown in e+tensive tree( form in
8igure 9:.9
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+n ,(strative +dvertising Game
A makes the first move y choosing either 6 or
7 at the first decision ;node. for firm A and ? for firm 3.
The game in normal taular( form is shownwhere A=s strategies are the rows and 3=s
strategies are the columns.
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