Two undergraduates, Harry and Sally, meet in the library. Th…
Two undergraduates, Harry and Sally, meet in the library. They would like to continue their conversation, but have to go to their separate classes. They arrange to meet for coffee after class, but in the excitement of meeting each other, forget to identify the place to meet or exchange cell phone numbers. There are two possible choices: Starbucks and Local Latte. It’s not possible to try both locations because the coffee shops are on opposite sides of campus. Both prefer Local Latte. Suppose p is the probability that Harry chooses Starbucks and (1-p) is the probability he chooses Local Latte. Suppose q is the probability that Sally chooses Starbucks and (1-q) is the probability she chooses Local Latte. Assume both players act to maximize payoffs. The outcomes related to this interaction are shown below: What are the values of p and q that make up the Nash Equilibrium in Mixed Strategy?