Question: 7. (15 points) Consider a trade game between the United States and Japan: (a) (5 points) Find the pure strategy Nash equilibrium to this game.

 7. (15 points) Consider a trade game between the United States

7. (15 points) Consider a trade game between the United States and Japan: (a) (5 points) Find the pure strategy Nash equilibrium to this game. Is there another outcome that the US would prefer? (b) (10 points) Explain how the United States can do better by changing the rules of the game by utilizing a promise or a threat, and identify the rollback equilibrium of this new game. How could the US make this promise/ threat credible

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