Playing for Pennies
Not all game theory games have a saddle point. Consider a simple game that requires a more complex playing strategy: Matching Pennies, another classic game theory problem. Here is how the game works: two players each have a penny. Hiding their penny from view, both players pick a side, heads up or heads down, and then simultaneously reveal their pennies. If they match, Player 1 gets both pennies. If they don't match, Player 2 gets them. We can graph this game on a payoff grid : ing to a certain probability ratio. For Matching Pennies, the mixed strategy requires rational players to randomly pick heads or tails, with a 50/50 chance of selecting either one.
