Consider the following strategic situation. Universal Studios is prepared to sell the exclusive promotional appearance in the movie "E.T." to one of the candy companies. If M\&Ms are featured in the movie, the publicity generated would increase Mars' profits by $1,200,000. Part of this increase would come at the expense of Hershey's - some of the candy consumers would switch from Reese's Pieces to M\&Ms. If M\&Ms are featured, suppose that the corresponding loss to Hershey's is $750,000. Similarly, if Reese's Pieces are featured then Hershey's future profits will increase by $1,200,000 and Mars' will fall by $750,000. a. Consider a sequential game. Universal Studios first offers the exclusive appearance to Mars for $1,500,000. If Mars rejects the deal, Universal Studios will offer it to Hershey for $1,500,000.2 Represent the game in its extensive form and find the SPNE. b. Suppose you are advising Universal Studio on the best way to sell the exclusive appearance. What would you recommend? Do not limit yourself to the proposal presented in part a. Consider the following strategic situation. Universal Studios is prepared to sell the exclusive promotional appearance in the movie "E.T." to one of the candy companies. If M\&Ms are featured in the movie, the publicity generated would increase Mars' profits by $1,200,000. Part of this increase would come at the expense of Hershey's - some of the candy consumers would switch from Reese's Pieces to M\&Ms. If M\&Ms are featured, suppose that the corresponding loss to Hershey's is $750,000. Similarly, if Reese's Pieces are featured then Hershey's future profits will increase by $1,200,000 and Mars' will fall by $750,000. a. Consider a sequential game. Universal Studios first offers the exclusive appearance to Mars for $1,500,000. If Mars rejects the deal, Universal Studios will offer it to Hershey for $1,500,000.2 Represent the game in its extensive form and find the SPNE. b. Suppose you are advising Universal Studio on the best way to sell the exclusive appearance. What would you recommend? Do not limit yourself to the proposal presented in part a