Nash equilibrium

The best example to look at first is the penalty kick left right Nash equilibrium.

Then, a much more interesting example is choosing a deck of a TCG competition: Magic: The Gathering meta-based deck choice is a bimatrix game, which is the exact same, but each player has N choices rather than 2.

The next case that should be analyzed is the prisoner's dilemma.

The key idea is that:

imagine that the game will be played many times between two players
if one player always chooses one deck, the other player will adapt by choosing the anti-deck
therefore, the best strategy for both players, is to pick decks randomly, each with a certain probability. This type of probabilistic approach is called a mixed strategy
if any player deviates from the equilibrium probability, then the other player can add more of the anti-deck to the deck that the other player deviated, and gain an edge
Therefore, using equilibrium probabilities is the optimal way to play

 Ancestors (4)