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Traveler's Dilemma

Medium · Game Theory & Logic · Quant Trader interview question · game-theory, nash-equilibrium, logic, rationality

Two travelers independently purchase identical souvenirs while on vacation. Upon returning home, their luggage is lost by the airline. The airline offers to reimburse them, but needs to determine the value of the lost items. The airline manager, suspecting the travelers might inflate the value, devises the following scheme: Each traveler is asked to write down the value of the souvenir, any integer between 2 and 100 dollars (inclusive). If both travelers write the same number, that number is pai