3. (8 pts) The drug transaction Warning: This game is purely for educational purposes and does not condone drug con- sumption or violence of any kind. After a cooking session with Jesse Pinkman, Walter White sets a meeting with new customer Tuco Salamanca to sell his fresh batch of crystal blue. Neither Walter nor Tuco 2 trust each other. They can both decide to bring a gun and rob the other instead of doing the transaction. If they make the transaction, they both receive payment of 1. If one steals from the other, he gets 3 and the other gets zero. If they both try to steal from each other, they get in a gun fight and can both potentially die. The payoff matrix is: Walter White Sells drugs Steals money Buys drug 1, 1 0 . 3 Robs drug 3, 0 -98 . -98 Tuco a) (2 pts) Find all pure-strategy Nash equilibria. b) (2 pts) What are the Pareto optima of the game? c) (2 pts) Find the mixed-strategy Nash equilibrium (assume Tuco buys with probability p, and Walter sells with probability q). d) (2 pts) Assume both Walter and Tuco can stay home and get a payment of zero. If they expect to be in the mixed-strategy equilibrium, will find it better to go to the meeting or stay home