Acme is currently the only grocery store in town. Bi-Rite is thinking of entering this market. They will play the following game. First, Bi-Rite will decide whether or not to enter. If it does not enter, then the game ends, Acme earns a payoff of 50, and Bi-Rite earns a payoff of 0. If Bi-Rite does enter, then Acme has to decide to fight by slashing its prices or to accommodate. If Acme decides to fight then Acme and Bi-Rite each earn -10; if Acme accommodates then each earns 20.
a. Draw the game tree for this game.
b. Use backward induction to figure out how this game will be played.