Posted in Marketing and Strategy Terms, Total Reads: 1991
Definition: Non Constant Sum Game
This is also known as zero sum game. In economics terms this happens when the gain (loss) of one party is offset by loss (gain) of the other party. This concept finds its application mainly in game theory.
Eg: In case of derivatives where party agrees to give a commodity at a certain future price to the second party, when prices of commodity are higher on the settlement date than the buyer will have some profit while the seller has equivalent loss. This is a non-constant sum game.