Suppose that the government passed a law preventing any firm from building more than one plant. Consider a game with N players sitting in a circle. At first, nature selects a card for each player with an integer number between 1 and M . The random process is independent for each player, and each card has a positive probability of occurring. All these choices are simultaneous, after which the game ends.
Payoffs are as follows.
Derive the set of mixed strategy Nash equilibria. Derive the set of correlated equilibrium outcomes. Complete the exercise on page 152 of the lecture notes. Assume first the horizon is finite, of length T . Now suppose that the horizon is infinite.