According to Duronio(2012), Game Theory allows companies and individuals to makerewarding decisions amidst competitive markets. By understanding themarket players, game theory makes it easy to predict the likelyoutcomes. As described my Mitchell (2012), a majority of companieshave limited knowledge concerning their payoffs and competitors,which makes game theory an effective tool in business. This paperdiscusses how I employed game theory to save money and the futurebenefit of the situation.
PersonalExperience Regarding Game Theory
Itwas during the holiday when I decided to purchase a computer with ahigh processing speed. The price of computers from dealers nearbyranged from $450-$500 for the computer I intended to buy. After I hadconducted my survey, I purposed to purchase my computer at $400. Iapproached the dealer who appeared to have a fast moving stock andfriendly. The price tag of the computer was $450. During mynegotiation, I indicated that another dealer offered the same priceof $450 and I expected it to be cheaper at his shop. After a shortdiscussion, I was able to purchase my computer at $400 and saved $50.
Itdid not realize I was implementing game theory until I was introducedto the concept in class. Nevertheless, I have enhanced my skills ofpurchasing goods compared to my childhood, when I would only bargainwith one seller. While purchasing my computer, I was keen to considervarious prices offered in the market to influence the dealers.
Benefits of the Game Theory
I saved significant of money $50, which is used to purchase twonovels of my dream. I decided to apply the same technique whilepurchasing costly items from dealers in future. Consequently,effective application of game theory allows individuals to purchasegoods at the lowest price tag.
Duronio Ben (2012). Easy ways to use game theory to make your lifebetter. Business Insider.http://www.businessinsider.com/how-to-use-game-theory-to-your-benefit-2012-4?op=1/#-salary-negotiations-1
Mitchell Osak (2012). Using game theory to improve strategicdecision-making. Financial post.http://business.financialpost.com/executive/using-game-theory-to-improve-strategic-decision-making