Term

Definition
Mathematical framework for modeling and analyzing conflict situations that involve economic agents with possibly diverging interests. 


Term
What is the focus of noncooperative game theory? 

Definition
Individual strategic and competitive utility maximizing behavior of economic agents (players). 


Term
What is strategic analysis? 

Definition
Considering situations from the viewpoint of other players to reach on adequate private choice of action. 


Term
Why is strategic analysis needed in game theory? 

Definition
Because the utility of a certain agent in interactive situations will also be dependent on actions of other players. 


Term
What is the main focus of cooperative game theory? 

Definition
Analysing the negoation process within a group of players in establishing a contract on a joint plan of activities, including an allocation of the correspondingly generated revenues. 


Term
What is a transferable utility game? 

Definition
A game where players can transfer utility (cash) between each other without any costs. The units if this utility are valued equally by all others. 


Term

Definition
It is a finite set of players. A set of 3 players is written as:
N = {1, 2 ,3} 


Term

Definition
It denotes the collection of all subsets of N. 


Term
How are the elements of 2^N called? 

Definition


Term
What is the formal notation of a TUgame? 

Definition
(N,v) where v : 2^N > IR with v(0) = 0 


Term

Definition
Set A is a subset of set B if it is contained inside B. This relationship is called inclusion or containment.
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Term
How is function v called and what does it denote? 

Definition
Characteristic function. For S is a subset of N, v(S) is called the worth or value of the coalition S. 


Term
How to write formally that N is divided into two disjoint groups L and R? 

Definition
N = L union R, L intersection R = 0 


Term
Assume two disjoint groups. Members of group 1 have one left hand glove and members of groups 2 have 1 right hand glove. A single glove is worth nothing, but a pair is worth 10 euros. Describe this situation formally. 

Definition
v(S) = 10 euros * min{L intersection N, R intersection N}
for all S element of 2^N 

