What is a dominant strategy in game theory?

What is a dominant strategy in game theory?

A dominant strategy is a strategy that is the best choice for a player, regardless of what the other players do.

Can you give me an example of a dominant strategy?

Sure! In the Prisoner's Dilemma, confessing is a dominant strategy for both players because it leads to a better outcome regardless of the other's choice.

How does this concept apply to real-life situations?

In real life, businesses often use dominant strategies in competitive markets, like pricing strategies that maximize profit regardless of competitors' actions.

Are there any limitations to using dominant strategies?

Yes, dominant strategies may not always exist in every game, and relying solely on them can lead to suboptimal outcomes in complex scenarios.