Question: please solve attached problem and show all work. 3. In a threemarket chain store game, the competitors (local stores) initially believe that the chain store

please solve attached problem and show all work.

please solve attached problem and show all work. 3. In a threemarket

3. In a threemarket chain store game, the competitors (local stores) initially believe that the chain store is crazy with probability 0.1. The payoffs are standard (the sane chain store obtains 0 if it accommodates an entry, (1 = 2 if there is no entry and 1 if it ghts an entry; the competitor obtains b = 0.5 if it enters and is accommodated, 1 if it enters and is fought, and 0 if it stays out). Assume all players behave according to the SPE. a) What will competitor 3 (the one that begins the game) do? b) What will the chain store do in market 3 and what payoff will it obtain in that market? c) What will competitor 2 do? d) What will the chain store do in market 2 and what will be its (expected) payoff in that market? e) What's going to happen in market 1: what will competitor 1 do and what will be chain store's response. Consider different cases if necessary. f) If competitor 1 is going to randomize, what is the probability of it going out

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