A Nash equilibruim is somewhat different from either dominant or dominated strategies. Remeber that a dominant strategy is always the best strategy to use and a dominated strategy is never the best strategy to use. In order to understand the Nash equilibrium concept we have to remember what an equilibrium is.

   In economics an equilibrium means that no one wishes to change their behavior as long as nothing else changes. Remember that a simple demand and supply equilibirum means that consumers are purchasing their desired quantity demanded and suppliers are selling their desired quantity supplied and neither wants to change as long as the other doesn't. But, we also learned that a change on one side of the market (such as a change in income or a change in production costs) will lead to new desired quantities on both sides. In other words, equilibrium quanitity demanded depends on where the supply curve is and equilibrium quanitity supplied depends on where demand is.

Click Here if you don't see topics listed to the left and below.