Playing the equilibrium of a one-stage game over and over again when the one-stage game is repeated is:
A) always a Nash equilibrium.
B) dominated in some cases.
C) weakly dominated in some cases.
D) a mixed-strategy equilibrium.

Question

Quizplus · Accepted Answer

Playing the equilibrium of a one-stage game over and over again when the one-stage game is repeated is known as a Nash equilibrium in a repeated game. This is because, in a one-stage game, the Nash equilibrium is a strategy profile in which neither player has an incentive to deviate. When the game is repeated, the same strategy profile can be played in each stage, and neither player will have an incentive to deviate from that strategy in any stage. Therefore, playing the equilibrium of a one-stage game over and over again when the one-stage game is repeated is always a Nash equilibrium.

Playing the Equilibrium of a One-Stage Game Over and Over