Question: (a) Consider the following dynamic game between Dante (Player 1) and Beatrice (Player 2). Dante and Beatrice would like to go on a date.

(a) Consider the following dynamic game between Dante (Player 1) and Beatrice

(a) Consider the following dynamic game between Dante (Player 1) and Beatrice (Player 2). Dante and Beatrice would like to go on a date. They have two options: a movie downtown at Cinemapolis, or a walk along Cayuga lake. Dante first chooses where to go, and knowing where Dante went Beatrice also decide where to go. Dante prefers the movie, and Beatrice prefers the lake. A player gets 3 out his/her preferred date, 1 out of his/her unpreferred date, and 0 if they end up at different places. Use a tree to represent this dynamic game. Find a subgame-perfect Nash equilib- rium. Find also a non-subgame-perfect Nash equilibrium with a different outcome, that is, where Dante and Beatrice go on a date in a different place. (b) Modify the game a little bit: Beatrice does not automatically know where Dante went, but she can learn without any cost. That is, now, without knowing where Dante went, Beatrice first chooses between Learn and Not-Learn; if she chooses Learn, then she knows where Dante went and then decides where to go; otherwise she chooses where to go without learning where Dante went. The payoffs depend only on where each player goes, as before. Use a tree to represent this dynamic game. Find a subgame-perfect equilibrium of this new game in which the outcome is the same as the outcome of the non-subgame- perfect equilibrium in part (a). (That is, for each player, he/she goes to same place in these two equilibria.)

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