B20 A SMALL STEP SIDEWAYS
Value a choice and its later consequences
A food truck can play it safe or gamble on a festival crowd, and a rival truck is choosing too. Weigh uncertain payoffs, value future days, and find where a price war settles.
LESSON OVERVIEW12 min lesson
Lesson overview
A food truck can play it safe or gamble on a festival crowd, and a rival truck is choosing too. Weigh uncertain payoffs, value future days, and find where a price war settles.
What you’ll explore
- Compute expected values and discounted returns, work a value backward one step at a time, and find the Nash equilibria of a small payoff table.
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