Consider the following one stage simultaneous game

		Player 2
		A	B	C
Player 1	A	6,6	1,7	0,3
B	X,1	4,4	0,1
C	3,0	2,0	1,1

a) Suppose x=7.5

, and that this game is repeated twice. Further suppose that players discount future period payoffs at a discount rate of 0d1

(that is, d

today is as good for a player as 1 tomorrow). Consider the following statement:

"There exists a subgame perfect Nash equilibrium in which (B,B)

is played in the first period."

In the blank, write the minimum value of d

for which the statement is true. If the statement is true for all possible d

, write 0. If the statement is not true for any possible d

, write 2.

Answer for part 1

b) Suppose x=7.5

, and that this game is repeated twice. Further suppose that players discount future period payoffs at a discount rate of 0d1

(that is, d

today is as good for a player as 1 tomorrow). Consider the following statement:

"There exists a subgame perfect Nash equilibrium in which (A,A)

is played in the first period."

In the blank, write the minimum value of d