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1. Consider the following game that is played twice. First, players move simultaneously and independently. Then each player is informed about the actions taken by

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1. Consider the following game that is played twice. First, players move simultaneously and independently. Then each player is informed about the actions taken by the other player in the first play and, given this, they play it again. The payoff for the whole game is the sum of the payoffs a player obtains in the two plays of the game. A 3,2 5,0 1,1 2.5 4,4 1,2 C 1,1 0,2 2,3 (a) (5%) How many subgames are there? (b) (10%) Suppose players are playing subgame perfect equilibrium strategies. What must each player choose in the subgames beginning after the first play is over and they have been informed about the outcome? (Remember this is the last round that will be played.) Write down all possible pairs of choices that can be used as part of a subgame perfect equilibrium. (You don't need to consider mixed strategies. ) (c) (10%) Is it possible for B and b to be played inthe first play of the game, in a subgame perfect equilibrium, even though (B, b) is not a Nash equilibrium in the payoff table above

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