Question: Problem 3. Consider the following game with three firms. First, firms 1 and 2 si- multaneously choose quantities 9 and 92 respectively. After observing

Problem 3. Consider the following game with three firms. First, firms 1 and 2 si- multaneously choose quantities 9 and 92 respectively. After observing firm 1 and 2's quantities, firm 3 chooses its quantity 93. There is no production cost and the inverse demand function is p = 12 (91 +92 +93). (a) Compute the SPNE of this game. (b) Give an example of Nash equilibrium s* with s = 4 and s = 6, that is not subgame perfect.

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