Question: 3. Two legislators select a policy that aects them both, by alternately vetoing policies until one remains. First legislator 1 vetoes a policy. If more

3. Two legislators select a policy that aects them both, by alternately vetoing policies until one remains. First legislator 1 vetoes a policy. If more than one policy remains then legislator 2 vetoes a policy. If more than one policy still remains, legislator 1 then vetoes another policy. The process continues until a. single policy remains. Suppose that there are three possible policies only, X, Y, and Z. Legislator 1 prefers X to Y to Z, and legislator 2 prefers Z to Y to X. a. Model this situation as an extensive game by drawing the game tree. Identify the SPE. Which policy is selected? (12 pts) b. Give an example of a strategy for legislator 2 and explain what it means. (5 pts) c. How would your answer change in part a. if now legislator 1 prefers Y to Z to X? (8 NS)

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