Roy loves to play the accordion. And, fortunately for Roy, he can make a decent living by playing music in his backyard for neighborhood kids and other accordion aficionados. If Roy doesn't play music, his only alternative is to dunk fries at a local diner for a living. Phil is a psychotherapist who runs a small but lucrative home business dispensing advice to distraught clients who need psychotherapy. As fate would have it, Phil lives next door to Roy, and Roy's accordion playing is affecting Phil's ability to counsel his clients. Suppose that Phil earns $600, but if concerts are played he makes just $400. Roy makes $100 by dunking fries. He earns $200 if he plays concerts instead. Create the relevant payoff matrices for each scenario below. In each cell, the payoff on the left corresponds to Phil; the other payoff corresponds to Roy. Suppose that concerts are illegal. What is the relevant payoff matrix? Roy Play Concerts Dunk Fries Phil Do Nothing $ , $ $600, $100 If Roy Plays, Call Police $ , $ ____ Suppose that concerts are legal and there is no bargaining. What is the relevant payoff matrix? Roy Play Concerts Dunk Fries Phil Do Nothing $400, $200 $600, $100 If Roy Plays, Call Police $ , $ ____ Suppose that concerts are legal and there is bargaining. What is the relevant payoff matrix? Roy Play Concerts Dunk Fries Phil Do Nothing $400, $200 $ , $ If Roy Plays, Call Police $400, $200 ____
