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Consider the following two-player game. S; - [0,1], for i - 1,2. Payoffs are as follows: U1(51, 52) =1-[$1 -(1/8)s2]4. U2(51, S2) =100-[$2 -51 -(1/8)]2.
Consider the following two-player game. S; - [0,1], for i - 1,2. Payoffs are as follows: U1(51, 52) =1-[$1 -(1/8)s2]4. U2(51, S2) =100-[$2 -51 -(1/8)]2. (a) Describe B1. Explain. (b) Describe B2. Explain. (c) Describe the rationalizable set. Explain. [Hint: it is not necessary that you use calculus to answer any part of this question.]
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