Question: Consider a bargaining game with alternating offers where player 2 has an outside option. Player 2 can choose the outside option after player 2

Consider a bargaining game with alternating offers where player 2 has an outside option. Player 2 can choose

Consider a bargaining game with alternating offers where player 2 has an outside option. Player 2 can choose the outside option after player 2 has made an offer and that offer was rejected by player 1. Assume that both players have a common discount factor = 0.9. The pie has size 1. The outside option for player 2 has a value of b = 0.9. Find a subgame perfect equilibrium of this game.

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