Question: please solve problem attached. Thanks! 3. Consider a two period bargaining game in which two players try to divide one dollar (so that the division
please solve problem attached. Thanks!
3. Consider a two period bargaining game in which two players try to divide one dollar (so that the division can only take place in multiples of one cent). Player one proposes a division scheme in the rst period. Player 2 can either accept or reject it. In the latter case, player 2 can propose her own division scheme in the second period with player 1 being able to accept or reject. If either offer is accepted, the game ends, and either player i's payoff is smelt1 where an, is her share, t is the period (t = 1, 2) in which the offer was accepted and 6 = 1/2. If no offer gets accepted both players obtain zero payoff. Assuming that an offer of 0 always gets rejected, nd all subgame perfect equilibria of this gameStep by Step Solution
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