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A couple engaged in a divorce are fighting over their assets, which are worth $1 milllion. Each has the option of bringing an attorney to
A couple engaged in a divorce are fighting over their assets, which are worth
$1 milllion. Each has the option of bringing an attorney to the settlement
conference. If one part brings an attorney but the other doesn't, then the part
with the attorney gets 75% of the asset and the other part gets 25%. If neither
brings an attorney or both bring an attorney, they split the assets evenly. An
attorney costs $100,000.
(a) Derive the payoff matrix corresponding to this game.
(b) Find the Pareto optimal outcome.
(c) Find the sDSE.
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