Consider the following game. Harry has four quarters. He can offer Sally from one to four of

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Consider the following game. Harry has four quarters. He can offer Sally from one to four of them. If she accepts his offer, she keeps the quarters Harry offered her and Harry keeps the others. If Sally declines Harry's offer, they both get nothing ($0). They play the game only once, and each cares only about the amount of money he or she ends up with.
a. Who are the players? What are each player's strategies? Construct a decision tree for this game.
b. Given their goal, what is the optimal choice for each player?
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Principles of Economics

ISBN: 978-0073511405

5th edition

Authors: Robert Frank, Ben Bernanke

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