00:01
So here we're talking about nash equilibrium.
00:02
And what is a nash equilibrium? it's an outcome of a game where there is no incentive to deviate, right? to change your behavior.
00:11
That given what your opponent is doing, you are also doing the best that you can do, right? nobody can individually move away and do better for themselves.
00:20
So the way that i always set these up is i like to draw them in different colors.
00:24
We're going to do cbs in blue.
00:27
We are going to do nbc in red.
00:30
I'm going to assume here that cbs always comes first.
00:36
So cbs has the choice to do early or late.
00:43
And nbc also has the choice to do early or late.
00:48
Now let's just first of all look at cbs's payoffs, right? cbs's payoffs look to me look like 20, 18, 15, and 30, right? so you see here that there's no dominant strategy for cbs, right? because if nbc plays early, cbs wants to play early.
01:20
If nbc plays late, cbs also wants to play late.
01:24
But let's look at the nbc payoffs.
01:28
The nbc payoffs are 30, 18, 15, and 10, right? now we see that nbc has a dominant strategy, right? they always want to play early, right? regardless of what cbs does, you can see that here in both cases, cbs does best by playing early...