Asked by Zuleyka Borrero on Sep 24, 2024

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​John Nash,the mathematician responsible for the Nash equilibrium,also proved that any reasonable bargaining outcome would

A) ​Split the gains from trade
B) Allocate the gains from trade to the seller
C) Allocate the gains from trade to the buyer
D) ​All of the above

Nash Equilibrium

Nash Equilibrium refers to a situation in a game theory model where no player can benefit by changing their strategy while the other players keep theirs unchanged.

Gains From Trade

The benefits that parties obtain from engaging in voluntary trade, allowing them to obtain goods or services they desire more than what they give up.

John Nash

An American mathematician known for his groundbreaking work in game theory, Nash Equilibrium, and his struggles with schizophrenia, depicted in the movie "A Beautiful Mind."

  • Grasp the concept of Nash equilibrium and its application to bargaining outcomes.
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Webby Bailey3 days ago
Final Answer :
A
Explanation :
John Nash's bargaining solution states that any reasonable bargaining outcome would split the gains from trade between the seller and the buyer. This means that both parties would receive a fair share of the benefits resulting from the trade agreement. Therefore, choice A is the correct answer as it aligns with Nash's proposition.