Alice and barbara are playing a one-stage guessing game


Alice and Barbara are playing a one-stage guessing game. Each must choose a number between 1 and 8 (inclusive). Alice’s target is to match Barbara’s number. Barbara’s target is to name twice Alice’s number. Each receives $10 minus a dollar penalty that is equal to the absolute difference between her guess and her target. Solve this game by iteratively deleting dominating strategies. What will Alice and Barbara choose?

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Business Economics: Alice and barbara are playing a one-stage guessing game
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