Any good economic experts solve it

Exercise 3.14: Challenging Question. In an attempt to reduce the deficit, the government of Italy has decided to sell a 14" century palace near Rome. The palace is in disrepair and is not generating any revenue for the government. From now on we'll call the government Player G. A Chinese millionaire has offered to purchase the palace for $p. Alternatively, Player G can organize an auction among n interested parties (7 = 2). The participants to the auction (we'll call them players) have been randomly assigned labels 1,2,....n. Player /is willing to pay up to $p, for the palace, where p, is a positive integer. For the auction assume the following: (1) it is a simultaneous, sealed-bid second-price auction, (2) bids must be non-negative integers, (3) each player only cares about his own wealth, (4) the tie-breaking rule for the auction is that the palace is given to that player who has the lowest index (e.g. if the highest bid was submitted by Players 3, 5 and 12 then the palace is given to Player 3). All of the above is commonly known among everybody involved, as is the fact that for every i, j {l,....,n} with i# j, p, # p,. We shall consider various scenarios. In all scenarios you can assume that the p,'s are common knowledge. Scenario 1. Player G first decides whether to sell the palace to the Chinese millionaire or make a public and irrevocable decision to auction it. (a) Draw the extensive form of this game for the case where 7 = 2 and the only possible bids are $1 and $2. [List payoffs in the following order: first G then 1 then 2] (b) For the general case where n=> 2 and every positive integer is a possible bid, find a pure-strategy subgame-perfect equilibrium of this game. What are the players' payoffs at the equilibrium