ECON1000 S1 2024, GTP Assessment [30%]
ECON1000 S1 2024 – GTP Brief
A. Context and Overview
The Game Theory Presentation (GTP) is worth 30% of the final mark.
GTP is a ‘take-home’ exercise with a set of tasks to do. The GTP is based on Lecture Topics: L1 and L2.
You will have up to eighteen (18) days to complete the GTP on your own.
Your GTP is to be submitted to Turnitin any time between Wed. 27th March to Wed. 3rd April 11:59pm.
Timeline of GTP-specific events (local time in year 2024AD):
▪ Assessment brief available on Blackboard (Bb): 17th March, 11:59pm.
▪ Clarifications of and indirect guidance on GTP in L2(b) tutorial: Week 4 of March 18th to 22nd.
▪ ETA of marks/feedback on your GTP in Grade Centre is by 24th April, 9pm.
Key assessment information:
▪ GTP consists of two (2) compulsory parts, each worth 15 marks in total.
▪ For supporting info on GTP, refer to the following PDFs, available in Assessments tab on Bb:
1) EPA Brief S1 2024 [this document]
2) Marking Guidance and FAQs for GTP S1 2024
▪
Note, the word count is a suggested maximum. The main thing is that you specifically answer the tasks and have sufficient explanations, and refer to key sentences and ideas from various articles* where relevant to support your analysis. *= the key articles are available for free online - but if not from Curtin’s Library databases or ‘Reading List’ on Bb.
The GTP will take up some of your thinking time, but this is a doable assessment!
A general guide on what the marker is looking for in the GTP is recalling the tutor student discussions in the workshop sessions on Modules L1; L2(a); and L2(b).
Your tutor as an exemplar would have gone through the process on how best to explain the payoff matrices, and so on. The local lecturer on L1 and L2 might come in handy as well.
Complete the tasks set out in this assessment brief by your human self -- no need for you to share/upload it on the web for extra help. The lectures, set tutorial questions, and assigned readings within this brief and from the CORE text should be sufficient resources for you to draw upon to do the tasks well enough.
Many thanks in advance for your cooperation, Brennan AI Tech Incorporated (BAT Inc.)
When ready to submit, ONLY include answers and prepare your document as following:
Full Name, Student ID and Tutor’s name as a title in the Word document (or PDF) to Turnitin by the due date (see Assessments tab on Bb).
GTP consists of
two parts:
Part 1 is on the
first issue,
worth 15 marks
Part 2 is on the
second issue,
worth 15 marks
This game theory presentation (GTP) in S1 2024 relates to two separate issues.
Your objective is to apply game theory to these issues:
First issue relates in part to SDG8, a ‘decent work for all’. Most of us want secure employment in a positive and safe environment with adequate compensation for the work we do. Acting is one such occupation. The entertainment environment is changing due to the takeover of streaming and other technological forces at play. Actors in
Hollywood went on strike for 118 days (from July 13th to November 8th 2023) over pay and working conditions, with costly economic impacts beyond production. Negotiations were heated leading up to and during the strike. A strike over pay or working conditions can be considered an example of an ‘ultimatum game’—and it is the task set ahead of you to see this recent historical strike through a game theory lens.
Second issue relates to the price-setting power of firms in a time in history where economies have recently endured a period of high inflation. Corporations with market power engage in all sorts of interesting practices to set prices above their costs e.g. see https://theconversation.com/why-prices-are-so-high-8-ways-retail-pricing-algorithms-gouge-consumers-223310.
Firms have plans about the future, and pricing strategies are part of the plan, having taken into account a number of relevant factors. What is happening to my expenses/costs of late? What price should we be still charging our customers in light of changing economic conditions? What are other firms doing? Powerful firms are the administrators and determine the price of the good or service in their own strategic interests. In this game theory task, you will need to evaluate the pricing strategies of major competitors and profit-taking behaviours.ECON1000 S1 2024, GTP Assessment [30%]
B. Assessment Tasks
Part 1 – 15 Marks
Your game theory tasks for Part 1 are as follows:
For relevant knowledge and guidance for this task, read the following (freely-available) articles:
1. https://theconversation.com/strikes-how-do-they-work-194598
2. https://www.smh.com.au/culture/movies/from-ai-to-pay-and-residuals-what-s-the-tinseltown-dispute-about-20230717-p5dou5.html
3. https://edition.cnn.com/2023/11/08/media/sag-aftra-actors-strike-over/index.html
4. https://www.latimes.com/entertainment-arts/business/story/2023-06-29/what-to-know-sag-aftra-strike-actors-hollywood# [sift through relevant]
You are to construct a relevant game tree for the 2023 Screen Actors Guild and American
Federation of Television and Radio Artists (SAG-AFTRA) strike based on the ‘ultimatum game’. You will need to identify the two players and make explicit your assumptions, with the following
instructions in mind:
▪ Specify who is ‘Player 1’ (the Proposer) and who is ‘Player 2’ (the Responder) for these two parties in a game tree.
▪ Think of this as a sequentially played game with three rounds in total over time:
o Each strategy has an associated payoff.
o In this game, you will need to work out what the associated numerical
(hypothetical) payoffs are. Use payoff integer values of 0 to 10.
o Provide reasons for the payoff values you assign and what they symbolise.
o Explain in words the game and each specific outcome you come across.
▪ In your analysis, discuss the role of power and preferences amongst the players and how this affects the allocation, including a scrutiny of fairness in the resolution.
800 ± 200 or so words should be sufficient
Part 2 – 15 Marks
Your game theory tasks for Part 2 are as follows:
For relevant context to setup this particular game, read the following (freely-available) key news
articles:
1. https://www.nytimes.com/2023/12/11/business/economy/profit-margins-inflation.html
2. https://www.cnbc.com/2023/12/15/unlike-fed-theres-no-sign-corporate-america-is-about-to-cut-prices.html
3. https://www.nytimes.com/2024/02/20/business/economy/food-price-inflation-cools.html
You are to construct a relevant payoff matrix (in numbers only) based on the key news articles.
To help you construct the payoff matrix, here are the key parameters and assumptions:
▪ This is a game played between major competitors in the food/beverage industry with market power in the largest economy, around Q3 to Q4 2023. There are two players – ‘Player 1’ is ‘corporation 1’ (e.g. PepsiCo), and ‘Player 2’ is ‘other corporations’ (e.g. CocaCola, Red Bull etc.).
▪ There are two strategies – ‘maintain prices’ (MP) or ‘reduce prices’ (RP).
o Each strategy has an associated payoff.
o The number for the payoff symbolises profits.
o Players act rationally.
o Firms’ main customers are from middle- and higher-income levels with strong
consumer demand.
Think of this as a simultaneously played game: this is a game played once and is repeated more than once, yet the rules, players, and payoffs are the same each time.
In this game, you will need to work out what the associated numerical (hypothetical) payoffs are.
Explain in words each quadrant and any specific outcome you come across.
800 ± 200 or so words should be sufficient
END OF GTP BRIEF