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Consider the following two player extensive form game which was introduced in part 4 of this lecture as Ultimatum game. Here we consider the modification

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Consider the following two player extensive form game which was introduced in part 4 of this lecture as Ultimatum game. Here we consider the modification that the players are friends and the happiness of sharing has some utility which is added for both players. 26 36 48 s R A R A S 9,1 0,0 1,5 0,0 4,2 6,0 2,4 0," The action set of player 1 is {1,2,3,4,5) (not considering the $ sign). When both players are rational, the theoretical SPNE is (5,1). Now answer the following problems. The action set of player 1 is {1,2,3,4,5) (not considering the $ sign). When both players are rational, the theoretical SPNE is (5,1). Now answer the following problems. What is the dollar equivalent of utility of happiness to ensure player 2 to accept the 2$ offer of player 1? Just write the number, no need to put the $ sign. 5 5 What is the dollar equivalent of utility of happiness to ensure player 2 to accept the 4$ offer of player 1? Just write the number, no need to put the $ sign. 100 X 100 Consider the following two player extensive form game which was introduced in part 4 of this lecture as Ultimatum game. Here we consider the modification that the players are friends and the happiness of sharing has some utility which is added for both players. 26 36 48 s R A R A S 9,1 0,0 1,5 0,0 4,2 6,0 2,4 0," The action set of player 1 is {1,2,3,4,5) (not considering the $ sign). When both players are rational, the theoretical SPNE is (5,1). Now answer the following problems. The action set of player 1 is {1,2,3,4,5) (not considering the $ sign). When both players are rational, the theoretical SPNE is (5,1). Now answer the following problems. What is the dollar equivalent of utility of happiness to ensure player 2 to accept the 2$ offer of player 1? Just write the number, no need to put the $ sign. 5 5 What is the dollar equivalent of utility of happiness to ensure player 2 to accept the 4$ offer of player 1? Just write the number, no need to put the $ sign. 100 X 100

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