Question

The increase in the price of goods is often a concern among the community. This is caused by factors that beyond of controlled such as a natural disaster, and others that cause the demand

exceed the current supply. However, what is more concerning is the increase in price of goods due to the individual who raises the price in order to ear higher profits. Therefore, to overcome this problem, a method of price controls using Game Theory is considered. The Game Theory realizing a form of observational on the action and effects that occur by an individual or group to maximize the utilization under certain circumstances. The study was conducted on prices of 14 fish commodities in the state of Terengganu and also to see the cooperation effect between players of commodity prices. Data were analysed by using the software Gambit. The result shows that there is significant increase due to the influence of middlemen. The findings also shows that the price controls are applied at a set time, then it was applied to other times, prices are more stable and profitable returns to all parties can be maximized.

(a) On the basis of above case-study, throw light on the benefits game theory brought in for the community.

(b) On what assumptions, game theory technique is based.​

Answer 1

Answer:

udy was conducted on prices of 14 fish commodities in the state of Terengganu and also to see the cooperation effect between players of commodity prices. Data were analysed by using the software Gambit. The result shows that there is significant increase due to the influence of middlemen. The findings also shows that the price controls are applied at a set time, then it was applied to other times, prices are more stable and profitable returns to all parties can be maximized.

(a) On the basis of above case-study, throw light on the benefits game theory brought in for the community.

(b) On what assumptions, game theory tech