Consider the reporting a crime game under incomplete information. Two players act simultaneously. Player 1 gets a payoff of v if the crime is reported and 0 if it is not reported. It costs the player 1 c to report the crime (and nothing not to report the crime). Payer 2 can be of two possible types. He is type 1 with probability q. A type 1 of player 2 has the same preferences as player 1. However, a type 2 of player 2 gets no benefit from reporting the crime, but he would still incur a cost c from reporting the crime (0 < c < v). 

a) Represent the above game as an extensive form game of imperfect information in which Nature moves first. 

b) Find all equilibria of this game

Answer rating: 100% (QA)

a To represent the above game as an extensive form game of imperfect information we can use a game tree The game starts with Nature moving first and d... View the full answer