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Consider the following two - player team production game. The players simultaneously chooses eort levels ( a 1 for player 1 and a 2 for

Consider the following two-player team production game. The players simultaneously chooses eort levels (a1 for player 1 and a2 for player 2), and revenue is given by 2k(a1+ a2). Suppose that player i's cost of eort is a2i in monetary terms. Revenue is split equally between the players, so, player i's payo is k(a1+ a2) a2i .
Assume that the value of k is privately observed by player 1 prior to her selection of a1. Player 2 does not know the value of k before choosing a2. Player 2 knows only that k follows uniform distribution between [4,6].
(a) Find the Bayesian Nash Equilibrium (eort levels) for this game.
(b) Consider a variation of the game in which, after observing k and the prior to eort selection, player 1 can provide evidence of the value of k to player 2. That is, after either realization of k, player 1 chooses either E or N. If she selects E, then k is revealed to player 2; otherwise, player 2 observes nothing other than that player 1 selected N . Represent this game in extensive form and calculate the perfect Bayesian equilibria. Are there any perfect Bayesian equilibria in which, at the time player 2 selects a2, she is uncertain of k?
(c) Would player 1 prefer to have the option of revealing k, as in part (b) relative to part (a)? Explain.

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