Two folks are fishing next to each other. Let x and y denote the amount of fish (in pounds) caught by players 1 and 2, respectively. Player 1’s payoff from catching fish isπ_1 (x,y)=2x-x^2/4-xy/10 π_1 (x,y)=2x-x^2/4-xy/10 . Similarly, the payoff of player 2 is . π_2 (x,y)=2y-y^2/4-xy/10
Find the Nash equilibrium using the Calculus method.
How much fish would player 1 catch if he was the only one fishing? Compare it to the Nash equilibrium outcome and conclude whether overfishing or underfishing occurs in equilibrium, compared to the individual fishing case.