Variance of the optimal pick in a two-below game
Question
Two players each secretly choose an integer from to , and the loser pays the winner . Normally the higher number wins and equal numbers are a draw, with one exception: a number exactly less than the opponent's beats it (e.g. beats ). Under optimal play each player uses a mixed strategy, choosing a random integer . What is ?
Short answer
. Choosing is always at least as good as choosing , so play collapses onto , , , which form a rock-paper-scissors cycle ( beats , beats , beats ). The equilibrium is uniform on these three values, whose variance is .
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