Solve for the Stackelberg subgame-perfect Nash equilibrium for the following game tree. What is the joint-profit maximizing outcome? Why is that not the outcome of
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Leader Sets Output Follower Sets Output Profits (1, 2) 48 (64.9, 64.8) (54.0, 72.0) 180 Firm2 64 96 (32.4,64.8) 48 (72.0, 54.0) (57.6, 57.6) (28.8, 43.2) 48(64.8, 32.4) (43.2, 28.8) 64 96 240 360 64 Firm 2 96 (0, o)
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Authors: Jeffrey M. Perloff, James A. Brander
1st edition
978-0137036059, 133379094, 321566440, 137036051, 9780133379099, 978-0321566447
