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Consider a game in which there are two players, A and B. Player A moves first and chooses either Up or Down. If A chooses
Consider a game in which there are two players, A and B. Player A moves first and chooses either Up or Down. If A chooses Up, the game is over, and each player gets a payoff of 2. If A moves Down, then B gets a turn and chooses between Left and Right. If B chooses Left, both players get 0; if B chooses Right, A gets 3 and B gets 1.
1(a) Draw the game tree for this game and find the subgame perfect equilibrium. (5 points)
1(b) Draw a game table for this (sequential) game and show how to find all the Nash equilibria. (20 points)
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