Matching Pennies
Two players simultaneously show a penny heads or tails. If the pennies match, Player 1 wins $1 from Player 2; if they differ, Player 2 wins $1 from Player 1. In the unique Nash equilibrium, what is the expected value of the game to each player?
Related problems & prerequisites
Worth solving first
- Solve the Matrix 5.0/10
- St. Petersburg Paradox 5.0/10
Source: Standard zero-sum game of the game-theory literature, dating to von Neumann's minimax work. Statement written for AxiomIQ.