Problem 4 (20 points) An industry is currently a monopoly and the incumbent monopolist is mak- ing a prot of $2 million. A potential entrant is considering whether or not to enter this industry. If she stays out, her prot will be $0 million; if she enters, the incumbent can either ght with a price war whose outcome is that each rm makes a loss of $1 million, or it can accommodate entry by sharing the market with the entrant, in which case each rm makes a prot of $1 million. (51) Draw the extensive-form game associated with this situation. (b) Describe the backwards-induction equilibrium of this game. (0) Write the strategic-form game associated with the situation. ((1) Describe and discuss the Nash equilibria of the strategic-form game in (c)