As we covered market structures in ECON 120, Game Theory was a subtopic within the teachings that struck my interest. Like many others, this is another economic concept we use in our everyday lives. This concept applies to various situations, from something as simple as playing a chess game to something riskier like investing in stocks. In both instances, one uses the study of strategic interaction to attempt foreseeing their opponent's next move while simultaneously discerning the next best option for themselves based on the observation at hand. Game theory is even used in the more personal aspects of our lives, for example dating. Say the person you really like hasn't contacted you in a couple of days. What do you do? Do you text them or remain silent? If you text them and don't receive a response, you risk the potential of feeling rejected, or if they text back, that turns into a win-win. On the other hand, you both could remain silent and end up in something similar to a Dominant strategy where both parties' feelings are left intact because no move has been made. This type of strategic thinking not only lends to incentives but also plays a part in our thought processes regarding how one makes rational decisions.
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